Financial Ombudsman and III fund transfer

Imnoexpert_2

I have had the result of my first complaint relating to the time taken to transfer funds and the errors which occurred and it made me wonder what the result has been for others who have used the service.

I have had £100 compensation and £100 credit and an apology. Basically I am judged not to have been out of pocket "I am not persuaded you have suffered a financial loss". I was effectively out of the market for a prolonged period so this is debatable.

The sentence which has me stunned though relates to the time taken to transfer cash sent from my previous supermarket to my account with III. " I understand your unhappiness with the time it can take for cash to be transferred in this era of 'faster payments". However 15 working days remains the generally accepted timescale and payments continue to be made by cheque".

Of course as they say it is not their role to supervise or punish firms. More's the pity!

Someone really needs to put a sharp stick to the backsides of this whole industry!

So what have others received as a result of a complaint to the Ombudsman?

dunstonh

The sentence which has me stunned though relates to the time taken to transfer cash sent from my previous supermarket to my account with III. " I understand your unhappiness with the time it can take for cash to be transferred in this era of 'faster payments". However 15 working days remains the generally accepted timescale and payments continue to be made by cheque".

Nothing wrong there. So, why does it stun you?

Of course as they say it is not their role to supervise or punish firms. More's the pity!

The FOS can report findings to the FCA if they feel a serious breach has occurred. The FCA also review complaints when they visit firms. However, there appears to be no such issue here.

So what have others received as a result of a complaint to the Ombudsman?

Does it matter? The FOS deals with complaints in many areas and most of them get rejected and end up with nothing. Your complaint is likely to be very different to someone with a problem with a pension or current account. So, asking what they may have got doesnt aid you. I'm struggling to see what your complaint is and why you think the response is wrong. 15 days is not unreasonably long.

Time for sale and settlement of cleared funds, preparing paperwork and sending the money to new provider. postage delay.... new provider may act on uncleared funds if they prefund transactions but the smaller or cheaper firms dont tend to do that (if yours didnt then thats not III's fault). So, add another 3 or so days for clearing and then settlement time on purchase. It can be quicker than 15 but you cant call 15 unreasonable.

Archi_Bald

There is very little reason why transfers of cash should take 15 days. That is assuming that the cash was sitting there ready to be transferred.

If transfers or funds or shares were completed in 15 days, that's a very acceptable timescale (whether in specie transfer or whether transfer cash proceeds from funds/shares sale were concerned)

le_loup

I think dunstonh has, very unusually, missed the point. IIIs transfer service this year has been a disgrace. Not just cash transfers. Everything they touch goes belly-up.
I got away from them before it got to the ombudsman and extracted compensation of £50 and £40 by threatening escalation. I wanted a lot more but gave up and am pleased to have them out of my life.

dunstonh

There is very little reason why transfers of cash should take 15 days.

I am assuming the 15 days includes the settlement periods. Not that the cash was already sitting there. happy to see that clarified.

I think dunstonh has, very unusually, missed the point. IIIs transfer service this year has been a disgrace. Not just cash transfers. Everything they touch goes belly-up.
I got away from them before it got to the ombudsman and extracted compensation of £50 and £40 by threatening escalation. I wanted a lot more but gave up and am pleased to have them out of my life.

I think I probably have as I was looking at the comments in isolation of other comments that may exist elsewhere. I did wonder if I was missing something. However, 15 days, whilst at the upper end is not unreasonable if the funds have yet to be sold down. The FOS does appear right in the quoted response.

quaybab

I can tell you cash ISA to S&S ISA transfers take up to 2 weeks from posting the form to credit in the new account (despite cash to cash taking days).
A couple of years ago, the FOS thought 2 months to transfer S&S ISA brokers was OK.
Perhaps you could answer your own question and tell us what http://www.ombudsman-decisions.org says about it.
IMHO, £200 is good as you are due £0.

meanbean

They're horrendous ime. I asked for a share transfer from III to HL to be processed. HL contacted III who did nothing. A month later I chased it up as wasn't sure how long these things take, III had lost all record of the original request and hadn't even initiated a transfer. They admitted an 'administrative error'.

Re a separate issue with III, I'm in the process of filing a complaint with the Ombudsman due to their stealth fees.

Imnoexpert_2

Thanks for all who contributed in reply to my thread. Since nobody has come on to describe their own experience of the ombudsman service and compensation which is what I was interested in it has failed. I deliberately didn't put in lots of detail so I think some people didn't quite get what my problem was. Some interesting points have come through though.

Cash transfer.
These were strictly cash transfers involving no fund transactions. The "payment to II" was made on one date and appeared as cash on my II account on the next date.

As I receive payments from many other sources within and outside the financial services industry I was surprised at the Ombudsman's comments as I hadn't realised 15 working days was "generally accepted". As a retail customer I wouldn't be happy with this from any other organisation I deal with.

FCA - Ombudsman and "Serious Breach"
This has been frustrating. for me and the people who have gone on the thread dealing with the III situation ( 808 posts,48000 views ). OK nobody ran off with people's life savings or gave dodgy advice but at best there have been thousands of badly treated customers and I think some official body should care about that. I think the 'generally accepted' standards and regulations in the area of transfers has proved the bar is set too low.

Someone thinks I don't deserve compensation. It seems that having to compensate, and the visible affect of that on the bottom line is the only thing the industry takes note of. Clearly the fines for mis-selling etc. demonstrate that the regulators think this too. I only wanted a prompt resolution of my problems and an apology - but if this is the way the industry works I am happy to take the money, which incidentally repays me for the many phone calls and letters I made if not compensates me for potential losses in not being able to trade funds. I think the letter to the ombudsman alone took me half a day to collect evidence and write-up. How much do you charge for half a day guys?

My reflection, now this saga seems to be nearly over, is that the investment industry is where lots of retail businesses were a generation ago (do you remember early closing? No Sunday trading? no sale of goods act? people 'doing you a favour to serve you?). It all has that feel to it.

So divorced from reality, that telling you transfers will take eight weeks (though ensuring that isn't in their contract or something they are regulated on) and then taking 20 weeks, or taking 15 working days to transfer cash is not seen as noteworthy.

Compared to the service I get from Amazon, John Lewis, Aldi, First Direct, or expect from a plumber or decorator I pay money to it is all very poor.

Rant over!;)

dunstonh

My reflection, now this saga seems to be nearly over, is that the investment industry is where lots of retail businesses were a generation ago (do you remember early closing? No Sunday trading? no sale of goods act? people 'doing you a favour to serve you?). It all has that feel to it.

Part of the problem is that if you use any other retail business and complain, they deal with internally and have no strict rules to follow. With financial services, it often turns into a rule book exercise rather than a consumer goodwill exercise. The focus, largely thanks to the FSA, is a tick box exercise. The FCA have said they intend to move away from that and some are saying that compliance on the retail side will ease off in future.

Compared to the service I get from Amazon, John Lewis, Aldi, First Direct, or expect from a plumber or decorator I pay money to it is all very poor.

Plumber and decorator are not comparable. They would be comparable to an adviser and you are bypassing the adviser/intermediary. iii are a product supplier/retailer effectively. You mention Amazon, that is probably a closer comparison but note that Amazon have hardly paid any tax, do not operate profitably and are killing other retailers who do have to consider those things. Once they kill off the market elsewhere and have to turn to profit, will things be as good? John Lewis.. you get what you pay for. Not looking to excuse iii as 15 days for cash to cash transfer is not good. However, they are small player in the budget market who are probably operating close to the bone to survive. This is a lot of the problem with financial services. Everyone wants cheap and providers keep cutting back to allow that but it is the service that suffers.

kangoora

I tend to agree with the above. Having to print off forms, physically write and sign them (in black ink no less!) and post them back was like a time-warp back to the 70's.

I made a transfer today from Santander to TSB to top up a savings account. The money was credited to the account in about 15 seconds (well, the time it took to log into the TSB to look anyway).

As for sales of funds and paperwork taking 15 days and this being reasonable? Do we have rooms full of bespectacled clerks writing down every sale transaction, documenting everything in some huge ledger, end of day accounting periods taking a couple of hours and then lovingly putting each share sale notice into an individual envelope then walking to the post room to put it in Outgoing Post.

I think it's more likely some guy pushes a button on a computer, it's automatically transferred at the speed of light and some huge database somewhere gets a few extra electronic records added to it whilst computer generating a Share Sales notice, adding an electronic signature and, maybe, some poor !!!!!! stuffing them in envelopes and posting them (maybe even this is automated in larger firms).

In certain circumstances, it may take a little while to sell some shares or if you still have paper certificates then yes, I can see the reason for a delay but, quite frankly, there are only two reasons in this day and age for these sort of delays.

1. Their systems are so archaic they can't cope with modern electronic messaging, transfers or record-keeping; or
2. They want to keep sitting on huge piles of cash (that is earning interest) for 10 days or more for 'some company' in the system whilst delaying payments to whoever happens to own it.

I know which reason I think is the true one.

bowlhead99

Imnoexpert wrote: »

The sentence which has me stunned though relates to the time taken to transfer cash sent from my previous supermarket to my account with III. " I understand your unhappiness with the time it can take for cash to be transferred in this era of 'faster payments". However 15 working days remains the generally accepted timescale and payments continue to be made by cheque".

Imnoexpert wrote: »

Cash transfer.
These were strictly cash transfers involving no fund transactions. The "payment to II" was made on one date and appeared as cash on my II account on the next date.

As I receive payments from many other sources within and outside the financial services industry I was surprised at the Ombudsman's comments as I hadn't realised 15 working days was "generally accepted". As a retail customer I wouldn't be happy with this from any other organisation I deal with.

It's not ideal. In your particular case, you had already sold down your assets to get cash and you just wanted to move the cash, as if it were a bank account that you directly controlled.

However, it is not a bank account that you directly controlled, it was part of a cash account held by a custodian which needed to be moved to a different entity controlled by a different group in a scenario where those two groups are not set up to automatically interface and talk to each other, as they have disparate systems which have been set up and evolved over a period of perhaps decades. The main use of their systems is to hold cash, hold investments, settle trades, react to corporate actions, reconcile dividends and interest, reclaim tax from HMRC etc etc.

Throwing your pot of cash across the miles to become your pot of cash with a different broker is not the main goal of their systems and will involve various steps that the end customer doesn't get to see. Whereas, the whole purpose of your current account is to quickly and easily distribute your cash around the country (or world) to anyone who wants it. So you can't compare one to the other and expect instant transfer.

For cash ISA to cash ISA transactions there are some relatively tighter guidelines in place for banks / building societies etc to try to adhere to, accounting for the lowest common denominator or weakest link between any of the businesses. For investment transactions it is not quite so straightforward. In your particular case, you had already sold down your assets to get cash and you just wanted to move the cash; for other people the assets might need to have been disposed and rebought either side of the transaction. They have lumped you in a bucket with 'transfer by means of cash' and said three working weeks is normal.

Obviously you'd have hoped to take less because your affairs are less complex, but if they know they have a period of time in which to complete the job, and they are busy, and there are manual processes and authorisations and rules and checklists in the background, maybe they will use up this time up and not try to rush through at breakneck speed even though they theoretically could.

Imnoexpert wrote: »

I have had £100 compensation and £100 credit and an apology. Basically I am judged not to have been out of pocket "I am not persuaded you have suffered a financial loss". I was effectively out of the market for a prolonged period so this is debatable.

I don't know the total amount involved but £200 and an apology for three weeks during which you had zero financial losses, seems above and beyond the call of duty.

You were out of the market for three weeks but that is kind of your doing really, isn't it. You said 'strictly cash transfer involving no fund transactions'. So, your money was not in the market. You had come out of the market and were in cash. You knew you were going to lose control of that cash for a period of time if you transferred broker to broker. If you had wanted to get into the market, you could have acquired investments, and transferred those investments in specie, staying in the market. Instead, you deliberately chose not to be in any investments, to try to keep your cost down.

By not being in any investments, you can't suffer any losses. So, the FO says he is not persuaded you have suffered a loss. Of course, potentially if the transfer went through a week earlier you might think you would have bought an investment in XYZ plc that went up by 50% so you want that 50% as compensation but it is not very easy to pull that off as the FO is not going to be minded to let you make those assumptions once you have the hindsight. Actually what might have happened is if the transfer had gone through in a week instead of three, you could have piled into a particular market and lost 10% in the next fortnight. You avoided that, by being in cash. Perhaps you should pay them, for saving you the 10% loss?

Of course you wouldn't. But you can see why the FO would be reluctant to order compensation for a return you 'might have' achieved when that return in a given week is just as likely to be negative as positive. You would only accept positive compensation and not negative compensation so it is a bit of a non starter for short term periods such as this. A token £200 for the hassle of having to chase it up, seems enough to me. I expect you haven't spent £200+ chasing it up.

All IMHO of course.