Advice on Maturing ISA - Virgin want £63 in fees on £16K

B144C

Hello,

I took out a Virgin Money ISA 2 years ago which matures in a few days. I do not want the ISA as I will get a higher rate of interest in a savings account and will not make enough to pay tax on, so the ISA is redundant.

I went on to the Virgin site and noted the date the ISA matured and the account number etc, then checked the nominated account was my chosen savings account.  After clicking Close Account I put the date the ISA matured and thought it was going well.  I had expected that on the last day of the ISA, the interest would be calculated and the full amount be transferred in to the account.

Virgin Money seems to think differently and is stating that there is a £63 charge for doing this.  I input my current account and even tried one at a different bank and got the same "warning" that unless I reinvest with them or transfer to a new ISA, they will take £63 and keep it.

This was not in the terms and conditions and I have looked through them again and can't find anything relating to this.

Calling Virgin Money is pointless, they are the most obstructive people I have encountered, unwilling to help or offer advice and refuse to deal with enquiries.

Has anyone else encountered this?

Any advice on what to do next?  I did email them and they refuse to deal with the enquiry, stating they have 8 weeks to respond to complaints.

I never expected this amount of trouble as I've never had this from any other bank.

eskbanker

What exactly does the £63 represent, i.e. how is it described?  Is it perhaps an interest penalty for premature closure, i.e. if you experiment with different closure dates does this change the outcome?  I don't know what the default maturity action is, but most will roll a maturing fixed-term product into an easy access one, which should be accessible in full at will without penalty....

isasmurf

Virgin Money doesn't appeared to have offered a 2 year Fixed rate ISA between April 2018 and June 2019 so I cant find the details for your account that matures in a few days time.  All fixed rate ISAs have a penalty for closure equal to a specified number of days of interest. You will see this in the summary box for your account in the section  about withdrawals. This is what you are being charged. It is not a fee.

The problem is you are trying to close a fixed rate account so the system is applying the usual closure algorithm which applies the penalty. There should be another route detailed in your maturity letter to give instructions as to where you want the money to go on maturity. The alternative is to wait until the account is redesignated as an access account after maturity then close the account

Albermarle

I think you need to be patient and wait for the fixed term to actually end , and then try again .

dunstonh

Calling Virgin Money is pointless, they are the most obstructive people I have encountered, unwilling to help or offer advice and refuse to deal with enquiries.

They do not hold regulatory permissions to give advice.   They can only deal with questions that have a factual answer.

Has anyone else encountered this?

This is typically seen where you are on a notice account and drawing without notice and the amount is the 30/60/90 (or whatever) days notice required being clawed back.  Or on a fixed term deposit before the maturity date.

Any advice on what to do next?  I did email them and they refuse to deal with the enquiry, stating they have 8 weeks to respond to complaints.

As it has been marked as a complaint, the front line will stop communicating on it and it will be passed to the complaints team. That is commonplace when you make a complaint and is to avoid a conflict in outcomes.  It is a regulatory requirement to notify you of the 8 week period.

I never expected this amount of trouble as I've never had this from any other bank.

The tone of your email was sufficient for them to turn it into a complaint rather than deal with it as an enquiry.   That forces them to deal with it a certain way and will add a delay.      

Are you sure you selected the right date? i.e. the day after the final day rather than the final day itself?