Strange error & now my mum owes thousands- help!

Baskethandle

Hello,
Firstly I couldn't find an appropriate category to post this so hope it's okay here.
Shortish version of the story is as follows. My elderly Mother recieved a letter out of the blue a couple of months ago from a pension/ bond company stating that they had made an error and had been accidentally overpaying her a monthly bond withdrawal for many years and they now require repayment. I have checked and she has been receiving the money. She had no idea it was an error and it amounts to an awful lot of money. She is not wealthy and has spent it on everyday living costs. The error occurred as she had a bond with them 20 years ago and when it was being set up, they accidentally input her bank details into another bond account which was set up on the same day. So for a while she was receiving 2 payments. Her bond was encashed a few years later but she continued to recieve the other payment up until very recently. She did not realise she wasn't suppose to be getting it for a number of reasons. Firstly, she was widowed in her early 30's with two very young children, at the time she received my dads life insurance policy and she employed a financial advisor to invest this on her behalf in order for it to make returns. She recieved a few different returns each month and lived off that money. She was not/ is not wealthy. She also has a history of depression following my father's death and didn't keep onto of things, I.e financial stuff. She's the type of person who buys car/ house insurance and let's it renew automatically every year without checking the quote. She is now in ill health so I have been communicating with the company about it and they are asking for 6 years worth of payments back. She doesn't have that type of money and if she was to pay them back a sum every month (which they have offered as an option) it would be quite a large chunk for her and would put her in a really difficult situation financially. I have told the company this and their last email has asked for her bank statements to prove her current financial situation. I don't really feel comfortable doing that as she doesn't really know that I'm talking to them, I've just told her the problem has gone away as she was so upset by it and has lots of other medical problems going on (cancer, major surgery then a fall last week which resulted in a serious injury). I don't have power of attorney. I really want this problem to go away and in the least disruptive way for my Mother as she's so fragile right now. Does anyone have an idea of what is best to do? I obviosuly don't want her to be taken to court but equally she can't afford to pay this back. Thanks!

JHW1942

Baskethandle said:

Hello,
Firstly I couldn't find an appropriate category to post this so hope it's okay here.
Shortish version of the story is as follows. My elderly Mother recieved a letter out of the blue a couple of months ago from a pension/ bond company stating that they had made an error and had been accidentally overpaying her a monthly bond withdrawal for many years and they now require repayment. I have checked and she has been receiving the money. She had no idea it was an error and it amounts to an awful lot of money. She is not wealthy and has spent it on everyday living costs. The error occurred as she had a bond with them 20 years ago and when it was being set up, they accidentally input her bank details into another bond account which was set up on the same day. So for a while she was receiving 2 payments. Her bond was encashed a few years later but she continued to recieve the other payment up until very recently. She did not realise she wasn't suppose to be getting it for a number of reasons. Firstly, she was widowed in her early 30's with two very young children, at the time she received my dads life insurance policy and she employed a financial advisor to invest this on her behalf in order for it to make returns. She recieved a few different returns each month and lived off that money. She was not/ is not wealthy. She also has a history of depression following my father's death and didn't keep onto of things, I.e financial stuff. She's the type of person who buys car/ house insurance and let's it renew automatically every year without checking the quote. She is now in ill health so I have been communicating with the company about it and they are asking for 6 years worth of payments back. She doesn't have that type of money and if she was to pay them back a sum every month (which they have offered as an option) it would be quite a large chunk for her and would put her in a really difficult situation financially. I have told the company this and their last email has asked for her bank statements to prove her current financial situation. I don't really feel comfortable doing that as she doesn't really know that I'm talking to them, I've just told her the problem has gone away as she was so upset by it and has lots of other medical problems going on (cancer, major surgery then a fall last week which resulted in a serious injury). I don't have power of attorney. I really want this problem to go away and in the least disruptive way for my Mother as she's so fragile right now. Does anyone have an idea of what is best to do? I obviosuly don't want her to be taken to court but equally she can't afford to pay this back. Thanks!

I think this is the key to it.  It sounds as if they've paid out incorrectly for years, and they are now trying to reclaim that money paid in error in the last six years (which is the furthest back they can go).  They are entitled to that money back but it sounds as if they're willing to consider a financial arrangement for partial repayment, staged repayments or even a reduction.  If you/your mother aren't willing to provide them with some contextual information to help create such an arrangement, they could simply take her to court for the full sum.  

How much, roughly, is the sum in question?  

Baskethandle

Thankyou for the reply. 6 years worth amounts to around £20,000, the total debt around £60,000. Do you think I should send them her bank statement? 

JHW1942

Baskethandle said:

Thankyou for the reply. 6 years worth amounts to around £20,000, the total debt around £60,000. Do you think I should send them her bank statement? 

At that level, I would consider getting some legal advice.  Some solicitors offer a free initial consultation.  I'm fairly certain they can only pursue the £20,000 so she's already had £40k of free money.  I can see why they are pursuing the £20k.

kazwookie

First of all I would establish that the 'out of the blue letter' is from the company and not some scammer preying on your mother. Do not contact the details on the letter, but from other paperwork or web site, scammers are very clever.

Next you need to talk to her about POA for health / and wealth, then get it set up.

Baskethandle

Thanks again. I initially contacted a solicitor who said that she may well have to pay but in the first instance I should instruct her to send a legal letter with a harsh push back in the hope they will fold and then take it from there. This first letter and work surrounding it will cost £1000+ and the solicitor doesn't seem confident that will work so I guess going down that route will cost a fair bit of money and at the end she might still be liable for the same amount anyway. Its a tough decision. 

Yes at first I presumed a scam but after delving into it, it definitely isn't. We contacted them from the official website and she has recieved the money. It matches up. 

JHW1942

Baskethandle said:

Thanks again. I initially contacted a solicitor who said that she may well have to pay but in the first instance I should instruct her to send a legal letter with a harsh push back in the hope they will fold and then take it from there. This first letter and work surrounding it will cost £1000+ and the solicitor doesn't seem confident that will work so I guess going down that route will cost a fair bit of money and at the end she might still be liable for the same amount anyway. Its a tough decision. 

Yes at first I presumed a scam but after delving into it, it definitely isn't. We contacted them from the official website and she has recieved the money. It matches up. 

I'd pay for that work in her position.  Looking at it dispassionately, she's had a £40k gift, so spending £1k on some legal help to try and secure the other £20k awarded in error looks a good deal.  Otherwise, she's going to have to find the £20k anyway.

eddddy

I guess that the company will be regulated by the Financial Conduct Authority - so you can probably make a complaint to the Financial Ombudsman Service (FOS), and they would investigate and make a decision for free.

You (or your Mother) have to go through the process of making a complaint to the company first. But it might be worth phoning the FOS helpline first, to see what they say.

Go here and scroll down, to find their helpline number: https://www.financial-ombudsman.org.uk/consumers/how-to-complain

Baskethandle

Yes I know exactly what you mean. The problem is my Mother barely has £1000 spare (me either) and the reality of the solicitor is that it's going to cost much more than that because that is just for the initial letter. It's like at what point do you give up and disengage the solicitor if we don't get anywhere. I have to also bear in mind that she's lost the monthly income from the bond company that although was paid in error she had no idea it was and relied on it. Money is currently very tight. Its a bit of a predicament. At this point I'm thinking perhaps the only way is to sell her house but trying to move her now would also be terrible 😭. Thankyou for the reply anyway, I think I am just desperately hoping there is some magic way out of this that I hadn't thought of!

JHW1942

Baskethandle said:

Yes I know exactly what you mean. The problem is my Mother barely has £1000 spare (me either) and the reality of the solicitor is that it's going to cost much more than that because that is just for the initial letter. It's like at what point do you give up and disengage the solicitor if we don't get anywhere. I have to also bear in mind that she's lost the monthly income from the bond company that although was paid in error she had no idea it was and relied on it. Money is currently very tight. Its a bit of a predicament. At this point I'm thinking perhaps the only way is to sell her house but trying to move her now would also be terrible 😭. Thankyou for the reply anyway, I think I am just desperately hoping there is some magic way out of this that I hadn't thought of!

I'd follow eddddy's advice in the first instance, then consider whether you should try and get the money together for a solicitor if that route doesn't work.

gettingtheresometime

I can't advise on the repayment situation but I'll just add this thought - if you were the person who owned the other bond, wouldn't you have queried as to why you hadn't received any income?