Leaving HL without transfer charges

SnowMan

masonic that's a great letter.

The only bit I don't understand is

The FSA guidance states in section 3.15 that "we would not regard consumers as being free to dissolve the contract if the terms did not provide that any exit charges would be waived to remove financial barriers to exiting the contract". I contend that the charge for transferring my holdings to another provider as stock is one such exit charge. This was not a standard term from the account's date of inception; in fact, the charge was introduced very recently in January 2013. Therefore, in effect the changes between 2013-2014 represent a unilateral change to the original contract without allowing me a free exit (via a two step change made in quick succession). I believe that the imposition of a transfer fee of £30 (£25+VAT) applied to each of my holdings would cause a significant imbalance to my detriment as compared with the contract terms that applied before 2013.

The re-registration per stock charge was in place before when they introduced the tracker charges in 2011.

The point about the January 2013 terms and conditions changes was that before January 2013 the terms just said HL could increase charges with 30 days notice for any reason (a unilateral clause) to terms that said they could increase charges with 30 days notice subject to specified reasons such as regulatory reasons.

Terms that say we can just increase charges unilateral have been shown time and time again to be automatically unfair.

I explain the argument in posts 24 and post 27.

masonic

SnowMan wrote: »

The re-registration per stock charge was in place before when they introduced the tracker charges in 2011.

That's a shame, I must have misremembered when that change came into effect. I took a copy of the T&Cs prior to the 2011 changes, but I didn't take another subsequently and I thought the re-registration fee was brought in later. I'll need to amend that section...

A_Flock_Of_Sheep

Hi! Is there any reason why people want to leave HL?

I was with HL and left because i found their share dealing costs a bit high.

I moved to Halifax who have sent a message about new fees but they seem fairly reasonable to me.

jamesd

Read this post, which has quotes from a FOS decision that specifically mentions charging in-specie transfer charges as being unfair charges that have to be waived. Quote from that and note that HL will undoubtedly also be aware from adverse FOS decisions in relation to its own customers that the in-specie transfer charges must also be waived.

No harm also to add that there's no point in wasting [STRIKE]HL's FOS fee,[/STRIKE] the time of the FOS and increasing HL's adverse decision count when the FOS position is so clear.

gterr

SnowMan wrote: »

I think the process would be

a) send complaint letter asking for waived exit fees
b) find new provider and start process to re-register away
c) get final response letter (or after 8 weeks) refer to FOS
d) wait for many months :rotfl:

Thanks again, Snowman and Masonic (and Malfesto for the earlier input).
Can I just check on the correct way to communicate with HL. Is an email adequate, or does it have to be a letter sent by post?

masonic

gterr wrote: »

Thanks again, Snowman and Masonic (and Malfesto for the earlier input).
Can I just check on the correct way to communicate with HL. Is an email adequate, or does it have to be a letter sent by post?

At the moment I am logging in and using their secure messaging facility. Providing you receive a reply acknowledging your message (best to save a copy).

---

I've updated the complaint letter in post #59 to remove the incorrect information about the date the transfer fees were added, and included the following paragraph to cover the two-step change to the T&Cs:

Furthermore, it should be noted that the 'valid reasons' clauses were only introduced into the contract in January 2013 and at that time I was not allowed the opportunity to dissolve the contract. Therefore, in effect the changes between 2013-2014 represent a unilateral change to the original contract without allowing me a free exit (via a two step change made in quick succession).

I've also included an excerpt from the FOS adjudication provided by jamesd.

lejog2003

gterr wrote: »

Thanks again, Snowman and Masonic (and Malfesto for the earlier input).
Can I just check on the correct way to communicate with HL. Is an email adequate, or does it have to be a letter sent by post?

Since they don't give an email address for complaints, I'd just do as they ask and write to the Client Services Manager hl.co.uk/contact-us/how-to-make-a-complaint. And put Complaint in bold at the top of the letter.

Sorry as a newbie I can't post direct links.

Edit: If you use secure messaging as Masonic suggests, I'd specifically ask for confirmation that the message has been received by the person responsible for handling complaints. Also be aware that once you've transferred, you will not be able to access the message!

malfesto

Please DO NOT refer to the case fee in your correspondence to either the firm or FOS. If the the firm or FOS think that you are threatening to refer the complaint to FOS because the firm will have to pay the case fee, this will be considered a frivolous and vexatious complaint. Your complaint will then be DISMISSED even though it would have been successful.

Regards,

malfesto.

thesaver79

Is anyone else going to file a complaint using the same letter?

SnowMan

Below is the opinion of the FOS adjudicator in 2012 in relation to my complaint against Hargreaves Lansdown's refusal to waive my re-registration charges, an opinion HL subsequently accepted. Slightly different argument this time round for those complaining now but still of some relevance.



14th September 2012

SnowMan’s complaint against Hargreaves Asset Management Ltd (”HL”)

Dear {named person at HL}

I am writing to set out my assessment of this complaint

SnowMan complains that HL changed its terms and conditions to include a platform charge fee. A transfer fee was not waived when he wished to exit the contract and as a result SnowMan sold his funds and repurchased them at a later date. He did this in order not to be caught by the new fees, however this, he states, caused him a financial loss.

When I make my opinion I do so based on the information provided by SnowMan and HL as well as any regulations or legal principles that are governing at the time

findings

Although HL has acted within its terms and conditions (14.0 Amendments), my investigation will focus on whether the terms laid out are fair and reasonable and if they are keeping with the regulations provided under the Unfair terms in Consumer Contract regulations 1999 (UCTA).

When deciding what is fair and reasonable, I am bound to have regard to, among other things, the relevant law and regulations. In making an opinion on this complaint, I have considered in particular:

- the 1999 regulations
- The Financial services Authority’s finalised guidance - Unfair contract terms Improving standards in consumer contracts of January 2012 and Authority’s publication - Fairness of terms in Consumer Contracts - Statement of good practice of May 2005.
- the undertaking given by Jarvis Management PLC published in February 2009 following action taken by the Financial Services Authority. (see http:/www.fsa.gov.uk/pubs/other/prime_jarvis.pdf)


I am not authorised to decide if a particular contract term is or is not unfair under the 1999 Regulations. But I have to take account of the Regulations as they are a material consideration.

The term in the contract under consideration states:

We reserve the rights to amend these terms and will give you notice at least 30 days in advance, before making material changes

I am of the opinion that this is a unilateral variation, which is potentially unfair because it does not specify valid reasons for its exercise , This means that consumers can have unfair terms, to which they have not agreed, forced on them.

The detriment would have been less likely to have been a problem if the contract had provided permission to exit from the contract freely and so not to be bound by any such variation.

In the view of the Financial Services Authority, ‘freely’ in this context means without paying any exit, closure or transfer fees, which should be waived. I concur with this view. Were it otherwise, consumers would be much more likely to stay put and accept unfair terms imposed on them, because they did not want to pay the exit fees.

In the current complaint SnowMan did exit the contract by selling the funds, this was done under pressure as he felt if he did not exit quickly then he would be caught by the new fees which HL wished to impose. Had the fee been waived SnowMan would not have had a loss to the value of his fund.

Conclusion

I am of the opinion therefore that the complaint should succeed and HL should place SnowMan into a position he would have been had he not been forced to take measures to escape the unfair contract term and caused him a financial loss. On verification HL should compensate SnowMan for the financial loss incurred after the selling of his funds.

If you agree with my conclusions, and are prepared to offer the proposed settlement to SnowMan, I would be grateful if you would let me know by 28th September 2012.

However, if you disagree with my conclusions, please let me know – also by 28th September 2012 – telling me your reasons, and enclosing any supporting documentation or further evidence that you have not already provided. Could you please let me know now, if you plan to reply fully but do not think you will be able to meet this deadline.

As a reminder, you will also have a right to ask an ombudsman to review the case – as the final stage in the process. But in most cases, complaints will not need to be escalated to that level, and can be resolved at an earlier stage.

Yours sincerely

Adjudicator