Dot ComUnity Credit Union - ISA

Archi_Bald

FOREVER21 wrote: »

My only concern rests with your final few words, the date for lifting the restrictions could be any time to suit DCU, 2016 perhaps!

That was my first thought, too - but the FCA/PRA must know that there is a large(?) number of maturing ISAs coming up imminently and that there are really only two possible alternatives: 1) to wind up DCU and get the FSCS pay the depositors, or 2) remove the 'voluntary' restrictions from DCU and closely monitor them over the next few months. I would think the FCA/PRA will prefer to keep businesses running if at all possible rather than shutting them down.

DCU must send out the first lot of maturity letters any day now, so they need to know what to put into these letters. Mind you, they have put all sorts of things into their letters before now.....or not sent any letters at all.

MARTYM8`

Archi_Bald wrote: »

That was my first thought, too - but the FCA/PRA must know that there is a large(?) number of maturing ISAs coming up imminently and that there are really only two possible alternatives: 1) to wind up DCU and get the FSCS pay the depositors, or 2) remove the 'voluntary' restrictions from DCU and closely monitor them over the next few months. I would think the FCA/PRA will prefer to keep businesses running if at all possible rather than shutting them down.

DCU must send out the first lot of maturity letters any day now, so they need to know what to put into these letters. Mind you, they have put all sorts of things into their letters before now.....or not sent any letters at all.

Based on their terms last April all the ISA accounts taken out with them then mature on one day - Tuesday 5 May. Yes for some weird reason they decided all the accounts should mature on the same day - rather than exactly 12 months from the date of opening.

So on that basis - given their terms state they are required to contact depositors within 28 days of maturity - the letters offering new terms for those who wish to stay with DCU won't need to go out until the first week of April.

So you have two choices

move the funds out immediately the restrictions disappear - and lose 3 months interest (presumably that is 3 months interest on the whole balance if you made transfers in since December?) or

wait for 5 May - get your 3% interest (assuming they do pay up - they didn't seem to pay anyone their dividend on their basic shares?!) - and you have a potential run on the bank as shedloads of accounts/funds mature on that one day.

Frankly the regulators must be aware of this 5 May issue - and the potential disruption to DCUs cash balances any mass withdrawals might create. Two days before the general election as well!

Ed-1

MARTYM8` wrote: »

(assuming they do pay up - they didn't seem to pay anyone their dividend on their basic shares?!)

As I understand it the dividend applies to the prior financial year (i.e. this year the dividend paid was for tax year 2013/14) so no-one that opened an ISA in April 2014 would qualify but would do so for tax year 2014/15 if they are a member next year.

MARTYM8`

Ed-1 wrote: »

As I understand it the dividend applies to the prior financial year (i.e. this year the dividend paid was for tax year 2013/14) so no-one that opened an ISA in April 2014 would qualify but would do so for tax year 2014/15 if they are a member next year.

I assumed that was the case - but the letter said everyone was getting the dividend of 3% not just those who were members at 31 March 2014.

A rather basic mistake - as I would imagine quite a few people have become members since last March. I am afraid its another example of their lack of attention to detail! How can we even have confidence they will work out any ISA interest correctly?

darren72

MARTYM8` wrote: »

How can we even have confidence they will work out any ISA interest correctly?

My thoughts exactly - They didn't back date the deposit date of the transfer date to the last day of earning interest with the previous provider - they said it would be calculate automatically when interest is paid - This I will be double checking very carefully.

Ed-1

darren72 wrote: »

My thoughts exactly - They didn't back date the deposit date of the transfer date to the last day of earning interest with the previous provider - they said it would be calculate automatically when interest is paid - This I will be double checking very carefully.

When I transferred from their 1 year to the 5 year ISA I can confirm that the interest applied was correct to the penny including in the case of ISA transfers the agreed backdating of interest to the date of the cheque they received from the previous ISA provider.

I have to say, although communication has been iffy to say the least and terms and conditions where you can find them seem to be a bit wayward at times, I have been pretty happy to ride the DotComUnity rollercoaster considering I don't intend on withdrawing any funds. I am a lot easier with my 'risk-free' deposits with the credit union than I am with certain stocks and shares!

abc2011

I've just returned to my home address to find 5 (yes, 5) exactly identical letters sent separately from them dated 3rd March.

What a complete shambles they are as an organisation. I'm also panicky as I was one of the last people into the 3% ISA in July (just before they stopped taking deposits) - so if they do get into cashflow problems in May I expect I won't be able to access the cash for a while.

Steve3S13

I think if there is a cash flow problem then they would be no longer able to trade and will face winding up procedures, then the protection comes into play and we all get paid out, 1 yr, 3yr and 5 year ISAs including all the interest due.
We then get a letter to take to another institution to prove the money is an ISA.
One question though. Will this cash qualify as a transfer in into a new ISA that has already been opened for 2015/16, presuming this all kicks off after the start of the new tax year?
If not then I'll hold off opening a new ISA elsewhere until we have an idea what will happen when The 1 year ISAs reach maturity.

masonic

Steve3S13 wrote: »

One question though. Will this cash qualify as a transfer in into a new ISA that has already been opened for 2015/16, presuming this all kicks off after the start of the new tax year?

Only if the account you open accepts transfers in at the time you get the money.

colsten

Steve3S13 wrote: »

One question though. Will this cash qualify as a transfer in into a new ISA that has already been opened for 2015/16, presuming this all kicks off after the start of the new tax year?

It would qualify as a transfer, don't worry.

Whether you could transfer into an existing ISA or needed to open a new one for the transfer depends on the terms of your existing ISA.