isa incorrectly transferred too early

sazdes

Hi, hope someone can assist
My parents had ISAs from 10-11 with AA which the interest rate was going to drop from mid november, so we sent off the transfer form to Aldermore with the box ticked for "do not transfer before X date" and the date we wanted the transfer to go through written down

Aldermore then sent the request through to AA (same form I completed) yet AA sent the money through immediately (rather than waiting for maturity) a month and a bit too early.

This has meant they have lost out on £50 of interest each (and obviously the tax free status of this money as this should have been transferred with the isa sum)

Aldermore are denying responsibility saying they told AA not to transfer before x date, AA are saying it was requested too early. AA said they would request the money to come back then resend it on the date they were originally told to, and document this, which so far they haven't

Does anyone know who is at fault here so we can ask for the lost interest to be returned?

thanks very much

innovate

I would say the AA has made a mistake here, and I would raise a written complaint with them.

They are legally obliged to allow the customer to stipulate a transfer date in the future:

Provision is made for the investor to stipulate a date for transfer proceedings to commence because, in some cases, for example where a notice period has to expire or where a maturity date has not yet been reached, the investor may not want the transfer to commence immediately.

Source: http://www.legislation.gov.uk/uksi/2010/2957/pdfs/uksiem_20102957_en.pdf

I would remind them of their legal obligation in my written complaint. I would also ask for the re-imbursment of the time they forced me to spend over the mistake they made, plus of course that they do whatever is necessary to properly transfer the correct ISA amount, together with all interest due, the day after the maturity date has been reached.

You may find they will have up to 30 days to actually complete the transfer, but you should be getting interest from your new provider from the date your funds leave the old provider.

sazdes

thanks very much, how much should I suggest they offer for the effort of making phone calls, writing letters to chase them not sending written confirmation as promised? thanks again

dunstonh

I dont think we have enough information to point blame at either at this stage.

If AA were told by Aldermore to not transfer before x date then AA are at fault. If they didnt tell them then AA are not at fault as they would have no way of knowing.

jimjames

I'm not sure of the rules for cash ISAs but sending forms off more than 6 weeks before the date the transfer is meant to happen sounds like a mistake waiting to happen.

If the new ISA has a matching rate of interest what is the actual financial loss if any? Sending it early missed the interest with one but should gain the same amount with the other?

sazdes

We sent it in early as wanted to open the new account at the interest rate it was being offered at (as the rates were dropping generally, didn't want to lose out). I assumed because I wrote (and phoned both banks to check) that since I wrote "DO NOT move before x date" that they would do so?

We have lost out because the AA interest is at 3.5% (and you lose their bonus if you remove the money before it matures), whereas the best rate we could move it to at expiry was aldermores 3.05%, so not only are we receiving less interest because of it being switched too soon, but we are also losing the bonus for removing it before maturity (not our fault)

Hope that makes it clearer? Thanks

innovate

dunstonh wrote: »

I dont think we have enough information to point blame at either at this stage.

If AA were told by Aldermore to not transfer before x date then AA are at fault. If they didnt tell them then AA are not at fault as they would have no way of knowing.

We were told that Aldermore sent the same form OP completed. This makes sense to me since I understand the old provider needs the account holder's signature. Therefore it is fair to conclude that the AA is at fault.

sazdes wrote: »

Aldermore then sent the request through to AA (same form I completed)

jimjames wrote: »

I'm not sure of the rules for cash ISAs but sending forms off more than 6 weeks before the date the transfer is meant to happen sounds like a mistake waiting to happen.

I have filled in a fair few transfer forms in my time and never seen anything that says "do not send request before xxxxxx". Also, on the various bank/BS web sites, in the BBA ISA transfer guidance, and most importantly in the law (see link I posted earlier) there is nothing about an 'earliest request date'. Or any 'latest request date', for that matter.

innovate

sazdes wrote: »

thanks very much, how much should I suggest they offer for the effort of making phone calls, writing letters to chase them not sending written confirmation as promised? thanks again

I would give them a list of the calls (with duration), plus any other time they caused you/your parents to spend on this. You may or may not want to suggest your hourly rate to them. You generally also get some compensation for the 'distressed caused' (£25 - £50 or so)

Plus, of course, they need to pay the full & correct balance on the correct date.

dunstonh

We were told that Aldermore sent the same form OP completed. This makes sense to me since I understand the old provider needs the account holder's signature. Therefore it is fair to conclude that the AA is at fault.

I disagree. For example, I have done an ISA transfer form this morning which is 5 sides of A4. Only two sides would go off to the new provider. The payment instructions are written on them. If the writing by the individual was not on the forms sent to AA then they wouldnt see it. Also, if the writing was not in an area that is for the instruction of the existing company but the new one then the existing one wont necessarily see it as they wont be reading that section.

i'm not saying it is not the fault of the AA. It could be. Its just that we dont know yet.

I would ask AA to see a copy of the form that was sent to them. If its the same form and its written in a place they would look at then AA are at fault.

sazdes

dunstonh wrote: »

I disagree. For example, I have done an ISA transfer form this morning which is 5 sides of A4. Only two sides would go off to the new provider. The payment instructions are written on them. If the writing by the individual was not on the forms sent to AA then they wouldnt see it. Also, if the writing was not in an area that is for the instruction of the existing company but the new one then the existing one wont necessarily see it as they wont be reading that section.

i'm not saying it is not the fault of the AA. It could be. Its just that we dont know yet.

I would ask AA to see a copy of the form that was sent to them. If its the same form and its written in a place they would look at then AA are at fault.

thanks, the transfer form was 2 pages printed on 1 sheet (back to back), so if Aldermore did send the same form I sent them (i'd assume so as its the only think they have consenting for the money transfer) then AA definitely received the notice not to send it early

Thanks all, will update if they bother to respond

innovate

sazdes wrote: »

Thanks all, will update if they bother to respond

Don't let them off the hook - - you did everything right. They messed it up, they need to correct it, and carry all the costs of correcting it. If you are persistent, you usually do get enough compensation to make it worth your while pressing for a proper resolution.

After your latest post, I now do have to agree with dustonh to some extent, however - - - if you do not know for absolutely sure that Aldermore sent the original form to the AA, then the fault may well lie with Aldermore, not the AA. Unless you have it already, I reckon you should first get a written statement from Aldermore that confirms (or otherwise) that they sent your full instructions to the AA.

Keep on fighting, you are right! :cool: