Endowment

Stephen_Williams

Took out 2 endowments totalling £70,000 through a broker in 1993 on his projected figures,we were never warned of any risks or possible shortfalls we actually have documentation from the broker showing a projected lump sum of at least £15,000 at the end of the term after paying off the mortgage. We received a red letter in July 2000 informing us that there was a possibility that the endowment wouldn't reach it's projected target and to contact our broker for advice on how to complain which we did on numerous occasions over the next 2-3 years. The broker constantly advised us we had nothing to worry about and being naive and inexperienced in the market we believed him, finally in 2003 on the advice of friends and colleagues we complained in writing. He has rejected our complaint and offered no compensation whatsoever although we have been informed by Scottish Widows that there is a projected shortfall of over £20,000. We have taken our complaint to the Financial Ombudsman and after nearly 3 years we have recently been told by an adjudicator that we have no grounds for compensation due to the 3 year time bar between 2000 and 2003 and that we were too late in complaining. We are appealing against this decision and don't hold out much hope although it is obvious we have been mis-sold and very badly advised. Any advice on what to do next if as expected they reject our complaint? Sorry this is so long winded but we are desperate and are faced with having to sell the house we built as we don't have the finances to pay off the £20,000

dunstonh

Took out 2 endowments totalling £70,000 through a broker in 1993 on his projected figures,we were never warned of any risks or possible shortfalls we actually have documentation from the broker showing a projected lump sum of at least £15,000 at the end of the term after paying off the mortgage.

Clarification: Those projections would not be his. They are set by the regulator that was in force at the time. It probably also says on those illustrations that they are not guaranteed and that you can get back more or less than those figures.

He has rejected our complaint and offered no compensation whatsoever although we have been informed by Scottish Widows that there is a projected shortfall of over £20,000.

That isnt grounds for complaint.

We have taken our complaint to the Financial Ombudsman and after nearly 3 years we have recently been told by an adjudicator that we have no grounds for compensation due to the 3 year time bar between 2000 and 2003 and that we were too late in complaining.

That sounds correct as the dates are consistent with what you would expect.

We are appealing against this decision and don't hold out much hope although it is obvious we have been mis-sold and very badly advised.

The FOS rarely overule it. You have to have been in hospital or had the wrong address, or the provider not applying the rule correctly for them to overule it. You knew 7 years ago that there was a high risk of failure. You would have to persuade the FOS that you couldnt complain for 7 years.

Any advice on what to do next if as expected they reject our complaint?

Call it a day on the complaints front as you have hit the end of the road realistically. Court action is your only option after that and you would have to prove a mis-sale which is damned site harder than the complaints proceedure where the adviser has to prove it wasnt mis-sold. You dont see hardly any complaints going to court due to low success rates. For example, that illustration showing the projections that you would no doubt use as evidence will contain warning messages about the risk. So, that would work against you.

Sorry this is so long winded but we are desperate and are faced with having to sell the house we built as we don't have the finances to pay off the £20,000

25 year mortgage? if so, that finishes in 2018 which is ample time to close the gap without it costing you much. Is the Scot Widows endowment unit linked or with profits? The 20k shortfall may not be as bad as that (although it could be worse).

EdInvestor

Post some information about the endowment so we can take a view.

Guaranteed sum assured
Declared bonuses
Surrender value
Monthly premium
Maturity date
Maturity forecasts

Interest rate payable on mortgage.

defender_of_the_weak

Challenge the adjudicator decision and ask for an Ombudsman ruling. Ombudsman rulings find in favour of the customer in 30% of cases so it is not a forlorn hope. If you originally complained in 2003 the the timescale runs from the date of your first letter back to the first letter from the insurance company with the words 'high risk'. Nothing else counts for the purposes of time barring complaints.

Also challenge matters on the grounds that you received advice from 2000-2003 from the adviser and this advice, as well as the original recommendation was at fault.

If your broker has dealt with this as I think he may have, it will have gone something like

'I'm unhappy about my endowment'
Dont worry, plenty of time to go yet

'I've got another statement and things have got even worse'
These things are cyclical and the stockmarket will recover

'I want to complain'
You're too late now

The initial date for a complaint is any expression of dis-satisfaction either verbal or written check for any correspondence before the supposed time bar that refers to such an expression or dates of meetings with your adviser