applied online for S&S ISA through my bank over a month ago--now radio silence

lama_pdx

Hello,

Thanks for everyone's advice around my first foray into S&S ISAs. I applied online for a First Direct S&S ISA on 8th February this year, transferring just over £3000 from my First Direct account. I split the investment into two funds.

The online application went through, the funds left my account within a couple of days. About a week later I contacted First Direct through their online messaging service for customers, asking why I hadn't received anything in the post about this new account. They advised me that the account would be administered through a certain department in HSBC and gave me a number to call. When I telephoned, a nice lady told me that my account had just been set up. She quoted me an account number and told me I would be receiving something in the post soon. I decided not to worry.

By 11th March I was fed up and telephoned again. A man told me that he had record of my account. I insisted I needed something in writing verifying the amount of the investment, terms, etc. He said "something should have been sent to you on 8th March." I pushed a bit and he said, "All the documentation you're asking for has been put in the post to you on 8th March."

So of course now it's 16th March and I'm sitting here like a chump with nothing.

I'm not going to telephone them again. I'm getting ready to draft a letter to both First Direct and to HSBC, telling them that if I don't have written confirmation of the investment within five working days I'm lodging a complaint with the FSA.

Before I do, I thought I'd check with everyone here, since I am in fact new to S&S ISAs, and indeed to the banking system here in general. Would you find this concerning?

jem16

lama_pdx wrote: »

Before I do, I thought I'd check with everyone here, since I am in fact new to S&S ISAs, and indeed to the banking system here in general. Would you find this concerning?

I would expect to see it online within a few days at most. However I'd be more concerned that you chose a bank for investing - any reason why you chose them?

lama_pdx

Thanks jem16. I chose the two particular funds with this SSISA after researching fund performance and fees across providers. If you're interested you can have a look at my older thread, where I received a lot of good advice.

Glad to know you also find it strange not to have received any confirmation by now! It's starting to feel like a red flag. I've now written to them saying I need something in writing within five days.

jem16

lama_pdx wrote: »

Thanks jem16. I chose the two particular funds with this SSISA after researching fund performance and fees across providers. If you're interested you can have a look at my older thread, where I received a lot of good advice.

I did but you didn't specifically mention the fees FD are charging. That's why i was wondering why you chose them.

lama_pdx

As reflected in their pdf entitled "Selected Investment Funds Insert", found http://www2.firstdirect.com/1/2/investments/investment-funds/investment-funds-comparison?WT.ac=FSDT_CTA_INV_INV1010
the total fees are: 1.32% per annum for the Invesco Perpetual Income (no set-up charges or fees) and 1.26% per annum for the JPM Emerging Markets Fund (also no set-up charges or fees).

But of course I want to get my account details in writing to ensure they've been invested the way I specified! Otherwise I'll just cancel the deal and start at square one.

jem16

lama_pdx wrote: »

As reflected in their pdf entitled "Selected Investment Funds Insert", found http://www2.firstdirect.com/1/2/investments/investment-funds/investment-funds-comparison?WT.ac=FSDT_CTA_INV_INV1010
the total fees are: 1.32% per annum for the Invesco Perpetual Income (no set-up charges or fees) and 1.26% per annum for the JPM Emerging Markets Fund (also no set-up charges or fees).

Both would have been 1%pa with Cavendish Online just now.

But of course I want to get my account details in writing to ensure they've been invested the way I specified! Otherwise I'll just cancel the deal and start at square one.

It is too long to set up.

lama_pdx

Just had a look: Cavendish Online lists 1.5% as the Annual Management Charge for Invesco Perpetual Income Fund, and 1.5% as the Annual Management Charge for the JPM Emerging Markets.

Thanks for your response.

jem16

lama_pdx wrote: »

Just had a look: Cavendish Online lists 1.5% as the Annual Management Charge for Invesco Perpetual Income Fund, and 1.5% as the Annual Management Charge for the JPM Emerging Markets.

Yes but Cavendish also have a 0.5% rebate on their funds making it 1%pa.

lama_pdx

Reading their fund prospectus for the Invesco PI, it looks as though there's an annual management charge of 1.5% *plus* a Trail Commission of .5%, the latter of which is rebated. So I came up with a total remaining charge of 1.5%. Perhaps I'm misreading it?

jem16

lama_pdx wrote: »

Reading their fund prospectus for the Invesco PI, it looks as though there's an annual management charge of 1.5% *plus* a Trail Commission of .5%, the latter of which is rebated. So I came up with a total remaining charge of 1.5%. Perhaps I'm misreading it?

You are misreading it. The 1.5% amc includes the trail commission of 0.5% normally paid to an IFA. It's this trail commission which is rebated. Most 1.5% funds comprise of 0.75% fund manager fee, 0.25% platform commission and 0.5% IFA trail commission.

There's a wee diagram here.

http://www.cavendishonline.co.uk/investments/our-service/

lama_pdx

Oh right! I'm convinced. That's very helpful indeed.

Maybe all this hassle with first direct is a blessing in disguise. Perhaps I'll write to cancel and then go to the cheaper option at Cavendish. Cheers!