AA ISA - Missing interest ??

philatio

Opened an AA Savings ISA last May. Stated interest rate was 3.35% for 12 months then drop to 0.5%
I put in the full 5340 allowed at the time and haven't touched it since.

Just opened a new Santander ISA and done the transfer in form.

Got a letter back from Santander today saying the transfer is now complete and 5362.38 has been received from the AA.


So thats £22.38 interest in 15 months.

Am I missing something or have I been ripped off here?

innovate

Seems the AA didn't pay the right amount of interest. I can't figure out any more than you can how they would have arrived at £22.38 interest for 15 months.

Hard to figure out who to complain to - but on balance, I would write to Santander, asking them for advice on what to do about the (obviously) missing interest. The reason I'd ask Santander is that I wouldn't want to have any responsibility for transferring ISA monies, since I did not want to loose the tax protection.

Santander probably can't do much, but if they ask you contact your original ISA provider, you can then go back to the AA and ask them to transfer the remaining interest to Santander, within the ISA transfer rules.

Plus, I would suggest, the AA owes you a good amount of money for (unintentionally or otherwise) trying to deprive you of interest that was rightfully yours, and for the time and efforts you had to afford to restore your rights.

philatio

Right been searching through the paperwork and after 12 months the rate dropped to 1.7% not 0.5
If you take 1.7% of 5340 and then take 25% of it (for the 3 months May-Aug) then its about £22-odd

So I think they have paid me zero interest for the first twelve months and then started paying the reduced rate this May.
They owe me about £180.

I'll phone them tomorrow but I can see this going to a long drawn out complaint procedure.

Anyone any experience of dealing with a missing interest situation?

innovate

Yeah, I think you are about right, I have reached similar conclusion after doing some more numbers. The AA didn't pay you the 2011-2012 interest.

I'd still go via Santander first (fully appreciating they have not made a mistake), just to be sure I don't lose the tax exemption. Santander need to confirm they will accept an amended amount from the AA into your ISA.

The AA needs to pay you the missing interest, and a really good amount for the c**k-up, for your time and effort to sort this. If you took them to the FOS, it would cost them £500 plus the time of their staff - - - so I'd start by asking the AA for

1. the missing interest to be transferred within the ISA transfer rules, and
2. £800 compensation

I would settle for

1. the missing interest to be transferred within the ISA transfer rules, and
2. no less than £400 compensation

badger09

philatio wrote: »

Right been searching through the paperwork and after 12 months the rate dropped to 1.7% not 0.5
If you take 1.7% of 5340 and then take 25% of it (for the 3 months May-Aug) then its about £22-odd

So I think they have paid me zero interest for the first twelve months and then started paying the reduced rate this May.
They owe me about £180.

I'll phone them tomorrow but I can see this going to a long drawn out complaint procedure.

Anyone any experience of dealing with a missing interest situation?

Just a stab in the dark here:o It's not one of those accounts on which the interest has to be paid away to another account is it?

Must admit I've not come across this with ISAs, but its not uncommon with 'normal' savings accounts e.g my Close Brothers Fixed Rate Bond does it & I've had others which did the same.

YorkshireBoy

Is it possible, for whatever reason*, that they've only transferred the capital plus this tax year's interest and left the AA account open** with your 2011/12 interest still sat there?

£5,340 x 1.75% is £90, so 3 months is approx £22.50 (as you have already established).


* Some providers' ISA transfer forms let you stipulate exactly what is to be transferred.

** A quick call to AA would confirm.

somethingcorporate

£800 compensation for such a small issue? You'll be so lucky.

I'd expect £100 max.

Making reference to the cost of going to the Ombudsman is a bit premature - this may be fixed with a 5 minute phone call, jumping up and down demanding hundreds and hundreds for such a tiny issue really does smack of money-grabbing.

YorkshireBoy

somethingcorporate wrote: »

£800 compensation for such a small issue? You'll be so lucky.

I'd expect £100 max.

Making reference to the cost of going to the Ombudsman is a bit premature - this may be fixed with a 5 minute phone call, jumping up and down demanding hundreds and hundreds for such a tiny issue really does smack of money-grabbing.

The largest 'goodwill' payment I had (from A&L) for an ISA transfer debacle was £200 from memory, but that was a much, much, larger transfer value.

Also, the £500 case fee isn't charged unless the case is passed to an adjudicator (and only 1 in 6 complaints are...meaning 5 in 6 are resolved by frontline staff writing a letter or two). I'd wager that the Santander/AA complaints staff know this too (after all, it's freely available information on the FOS website), so I'd be careful about trying to let them know you know what you're talking about.

noh

This was an "AA internet access ISA" ?
3.35% with a 12 month bonus of 1.65%
http://www.theaa.com/savings/index.html#tabview=tab4

If so can you not log into your online account with the AA and look at the account in question to see if interest was added 12 months after opening.
Statements for all my closed internet accounts are still listed there.

philatio

I should be able to but my account says it's locked and I need to phone them. Odd.

I'll give them a call tomorrow anyway and take it from there.

innovate

somethingcorporate wrote: »

£800 compensation for such a small issue? You'll be so lucky.

I'd expect £100 max.

Making reference to the cost of going to the Ombudsman is a bit premature - this may be fixed with a 5 minute phone call, jumping up and down demanding hundreds and hundreds for such a tiny issue really does smack of money-grabbing.

If the problem is that they cannot even get small ISA transfers right, they have an absolutely massive problem at hand, and they should be grateful to people who make them aware.

Asking them for what they would have to pay if the case went to the FOS as an entry-point to the negotiations doesn't sound "money-grabbing" to me at all. Bit cheeky for representatives of the AA and other financial organisations to suggest consumers are money-grabbing, anyway

YorkshireBoy wrote: »

The largest 'goodwill' payment I had (from A&L) for an ISA transfer debacle was £200 from memory, but that was a much, much, larger transfer value.

Also, the £500 case fee isn't charged unless the case is passed to an adjudicator (and only 1 in 6 complaints are...meaning 5 in 6 are resolved by frontline staff writing a letter or two). I'd wager that the Santander/AA complaints staff know this too (after all, it's freely available information on the FOS website), so I'd be careful about trying to let them know you know what you're talking about.

It's a very simple set of maths from where I sit. A claim costs a company quite a bit of money - even if the claim gets turned down. In the case at hand, it is almost certain that the company made a major c**k-up and the claim would succeed. If the case went to to FOS, it would more than likely cost the company in the region of £1K upwards. So asking for £800, and being prepared to settle for £400, doesn't sound unreasonable at all to me. You could argue that asking for £800 actually saves the company money.