Sippdeal shocker (& link to template complaint letter)

SnowMan

Just attaching a link to the OFT guidance on unfair terms worth looking at the sections on group 10 and group 12.

http://www.oft.gov.uk/about-the-oft/legal-powers/legal/unfair-terms/guidance#.UqItrSfZdTg

The conclusion you should come to if you read that is that there is absolutely no way that Youinvest can significantly increase charges (above national average earnings) without allowing the customer to dissolve the contract and move away by the waiving of re-registration costs.

SnowMan

Sadly it appears that Youinvest are persisting with this grossly unfair treatment of investors by refusing to waive exit charges (including re-registration charges). In my case I am subject to a quadrupling of charges and the exit penalty amounts to about 3 years worth of platform charges.

There are no reports from complainants of final response letters being received yet. But once received I and it appears some others will be taking the matter to the Financial Ombudsman Service.

Investors who are not happy with this unfair treatment should register a complaint with Youinvest see this earlier post for a template complaint letter.

BLB53

Sadly it appears that Youinvest are persisting with this grossly unfair treatment of investors by refusing to waive exit charges (including re-registration charges). In my case I am subject to a quadrupling of charges and the exit penalty amounts to about 3 years worth of platform charges.

I suppose it may be worth pointing out that I am one small investor who has been put off from investing in low cost funds such as Vanguard because of the £50 custody fee.

I suspect the majority of investors have total funds below say £20,000 and the annual charges for such a sum would be £40 p.a. - that would be less under the new structure than previously.

So, I knew there would be new charges coming in when I transferred over from Interactive Investor 18 months back. I think the new charges are reasonable and certainly competitive.

Whether it is unfair not to allow dissatisfied customers move out for free - I don't know but I suspect the numbers wanting to move their account will not be very high.

I think it will all settle down early in the New Year.

SnowMan

BLB53 wrote: »

Whether it is unfair not to allow dissatisfied customers move out for free - I don't know but I suspect the numbers wanting to move their account will not be very high.

What not allowing investors to transfer out for free does do, is create a significant imbalance in the contract. Investors have signed up to the original charges not quadrupled charges. If you can't freely exit from terms you haven't signed up to then that is a massive imbalance.

If this sort of thing was allowed under law (it isn't fortunately and its morally repugnant too) then any company could hook people into any contract and then increase the charges under the contract unilaterally and charge them to leave.

If I had the right to demand that Youinvest reduce their charges to one quarter of their existing charges, and if Youinvest didn't agree to that, I was allowed to charge them 3 times the annual charge to get out of the contract, then I don't think many people would think that might be fair to Youinvest. So it follows it is unfair the other way round.

If individual investors aren't facing an increase in charges, then of course there is no need to offer them a penalty free exit. But we are talking about investors who are faced by an increase (in some cases a quadrupling or sextupling of charges).

ey143

Snowman - nicely worded and I like the analogy which I might just use if I decide to take this case further to the FoS.

I got, what appears to be a final reply from YI some 10 days ago, essentially saying they are not agreeing to my complaint about the exit charges.

I'm currently on holiday so haven't had a chance to look at other companies and whether they have updated their policy in light of the regulatory situation.

Is there such a thing as a class action complaint (not law suit) in the UK. I think every broker in the UK has a right to increase their charges to what they want but what they should not have is the right to penalise people by preventing them from exiting the firm without charge if the increase in fees is not deemed reasonable. To me the fee increase for a sizeable portfolio is not reasonable.

I would have accepted the fact that an inactivity fee be charged because there is a cost to a business but as I am a regular trader, its not as if I'm not bringing them any business.

noh

I note that ATS have now published their new charges.
They have waived exit charges for a period of two months for those that wish to leave.
It would be around £200 pa cheaper for me to hold my SIPP with ATS comapared with YouInvest

http://www.alliancetrustsavings.co.uk/forms-documents/fees-charges/GENF1025-12-13_Table-of-Charges.pdf

A_Flock_Of_Sheep

I thought people wanted RDR. Now they are moaning?

SnowMan

noh wrote: »

I note that ATS have now published their new charges.
They have waived exit charges for a period of two months for those that wish to leave.
It would be around £200 pa cheaper for me to hold my SIPP with ATS comapared with YouInvest

http://www.alliancetrustsavings.co.uk/forms-documents/fees-charges/GENF1025-12-13_Table-of-Charges.pdf

Thanks for alerting us to that.

I am just switching to ATS and after their fee increase they are still a much cheaper option for me than Youinvest, in fact less than half the cost. So I've definitely made the right choice.

Also it is brilliant to see ATS treat customers fairly with the temporary waiving of exit fees. What a complete contrast to Youinvest who have shown themselves to be an organisation who in my opinion don't treat customers fairly and simply can't be trusted.

I would urge everyone currently with YouInvest to look to see if ATS are cheaper than Youinvest. If they are cheaper then it is worth re-registering to ATS, and if you are being hit by a significant increase in charges at Youinvest, and believe you are being treated unfairly, put in a complaint and take the matter to the Financial Ombudsman Service. I believe it is a near certainty your complaint will be upheld by the FOS.

SnowMan

A_Flock_Of_Sheep wrote: »

I thought people wanted RDR. Now they are moaning?

I think you may have posted on the wrong thread (?). RDR is a really good thing. It provides much more transparency for investors.

The Youinvest changes are really a massive fee increase, on the back of RDR changes (albeit there will be a few winners as well as a lot of significant losers).

Investors already being explicitly charged through clean funds (i.e. already RDR compliant) can typically be faced by a quadrupling of charges and exit fees amounting to 3 x the annual platform charge. So for those investors the Youinvest fee increase is for example just a quadrupling of charges and not really anything to do with RDR.

It is the unfair decision (in my opinion) by Youinvest in not waiving exit fees that some of us are unhappy with.

pip895

A_Flock_Of_Sheep wrote: »

I thought people wanted RDR. Now they are moaning?

RDR will produce winners and losers. The losers will complain the winers stay smugly silent.:)

To me the moral high ground is with the complainants if there is any element of profit in the exit charges. If the charge can be demonstrated to be purely covering costs then its not so clear cut.:undecided