Are your savings safe? article discussion

Optimist

moneysaver39 wrote: »

I can't see Sainburys bank on Martins list of linked institutions does anyone know if they are linked to another bank?
Am I correct that from the 50k guarantee they would deduct any money you owe the company? So if you had 20k savings with bank A and a mortage of 100k with bank A, you would not get your money back?
please help getting very confused!

As far as I am aware Sainsburys has its own individual banking licence so you are covered up to the whole £50K with them

murphydavid

I-LOV-MONEY wrote: »

Yes, just checked. It arrived back today :mad:

Anybody got any views on ICICI bank. Is it "safe" to leave £7k there ?

Out of interest (no pun intended). How did you check? As far as I can tell no one can log on at Icesave?

Optimist

murphydavid wrote: »

Out of interest (no pun intended). How did you check? As far as I can tell no one can log on at Icesave?

Yes you can.. You just cant transfer money. In fact its a good idea to log on and take a print out of your accounts

1694

To secure your savings, demand a 0% interest Government savings account.

lost interest is little price to pay for 100% security.

The governement can then use this reserve and fractional reserve themselfs 9 times this amount, as any commercial bank does.

Lend the fractional reserve money to the banks to ease there liquidity.

charge the banks interest.

use the interest to pay off tha national debt.

reduce tax and increase public spending.

murphydavid

Just a mumble in my beer.
I had a fixed interest account (so I can't/couldn't move it) with Kaupthing - Its now
with Ing direct. This means my money was moved from a company that had full FSCS to a company that is G'teed by a foreign government. Since a whole country (Iceland) can declare itself Bankrupt and renade on its G'tees I would prefer to put my money back under the UK FSCS rules and sink or swim with the UK. Is it legal to take control of my money out of my hands and post it off to Holland?
They say they were protecting it for me, but in reality they have protected the FSCS who now don't have to compensate me.
Looking after my savings seem like trying to get a firm grip on jelly.
Still I would not like to be in Iceland trying to import a few essentials and no one accepting my credit. Reindeer stew again dear.

Optimist

1694 wrote: »

To secure your savings, demand a 0% interest Government savings account.

lost interest is little price to pay for 100% security.

The governement can then use this reserve and fractional reserve themselfs 9 times this amount, as any commercial bank does.

Lend the fractional reserve money to the banks to ease there liquidity.

charge the banks interest.

use the interest to pay off tha national debt.

reduce tax and increase public spending.

I assume that's a joke, well it made me laugh :rotfl:

marky1125

Hi,

If I understand it correctly this article needs an update so that the colouring of "Ing Direct" and "Kauthping Edge" are linked, or is that not the case now that Ing Direct has bought Kauthping Edge?

Sorry if this has already been covered elsewhere. I did search this thread and found no mention of Kauthping Edge.

Cheers,
Mark

Senator

After what've experienced so far... I just don't trust banks with my money. Keep withdrawing and puting in secure safe is also worrying from theft/fire/floods...etc. Does anyone know any alternative?

I-LOV-MONEY

Senator wrote: »

After what've experienced so far... I just don't trust banks with my money. Keep withdrawing and puting in secure safe is also worrying from theft/fire/floods...etc. Does anyone know any alternative?

Under the mattress ?

Mr_Crunch

primowino wrote: »

How can you identify your full exposure to a bank. When you have some investments / cash ISAs the terms and conditions will tell you that your money will be placed in a client money account, but it does not tell you what bank it is with, also if you have a broker account or money for a house purchase or a retainer with a solicitor it will be placed in a client money account with a bank you are not told about.

So you could think you are safe but for example yo could have a £5,000 retainer with a solicitor which the solicitor has in Co-op bank, you may have £10,000 with a broker who holds it in a client money account at Co-op bank you could have a Smile ISA (money held in Co-op) with prior year accumulation totalling £25,000, savings with the CO-op of £20,000, trust accounts for 2 children of £1000 each in the Co-op. So you would think you had £23,000 with the Co-op, but you actually have £63,000.

The FSCS covers an entity going bust, so your claim if Co-op went bust should be £63,000, or the £50,000 limit, but you would never know until the solicitor or the broker said they would not honour your claim.

Tricky - or have I got it totally wrong?

Good question, well done. Are there any conveyancing solicitors out there who can answer my supplementary?

We are going to be buying a property and for the last year have had our funds spread around across separate accounts to ensure that the FCSC limits are not exceeded should any of the banks fail. (Incidentally when I dispersed the funds last year I deliberately avoided banks such as the Mickey Mouse Bank of Iceland with suspiciously high interest rates).

I had not considered that solicitors’ general client accounts could be counted towards our FSCS limits should the funds be held with the same authorised institution. Is that really the case?

I have had a brief look at the Solicitors Regulation Authority (SRA) Accounts Rules http://www.sra.org.uk/documents/rules/Solicitors-Accounts-Rules-July-08.pdf but they are written by solicitors and are 127 pages long. They are supposed to “keep other people's money safely in a bank or building society account identifiable as a client account”. (My italics)

The FSCS says at http://www.fscs.org.uk/consumer/faqs/deposit_claims_faqs/ in section 11 “However, if the solicitor is holding your money in a client account with an authorised deposit-taker that fails, then your claim is against the deposit-taker and you should ask us to deal with it.” Great - that could be a life's work to unscramble.

My last solicitor’s Ts&Cs only state that they “normally hold money in a general client account with a clearing bank…”, and no doubt the unpleasantness of banks going bust has never occurred to them before. There is no mention of any liability accepted by the solicitor to hold the funds safely.

Purchasing a house involves placing a 10% deposit with a solicitor from just before exchange of contracts until completion (therefore perhaps for 6 weeks) and the 90% balance from at least 5 working days before completion (to allow time to clear). So the exposure is 10% for maybe 6 weeks then 100% for at least 5 days.

It is not difficult to think of possible solutions which might avoid the problem but:
- No doubt purchasers’ solicitors would not wish to have multiple transfers direct to the vendor’s solicitors bank, and then neither would the vendor wish to be exposed to loss of such a large amount either…
- Insurance against bank failure is yet another cost to add to the process…
- Solicitors’ Professional Indemnity Insurance …. who wants to try claiming on that?

So there are 3 questions:
1) Is it correct that monies held in a solicitor’s general client account on behalf of a single (or joint) purchaser are added to other deposit balances held singly or jointly by that purchaser, in the event that it is same authorised bank in both cases, for the purposes of the FCSC limit?

2) Even if the purchaser and the purchaser's solicitor use a different authorised bank, then for an example £500k purchase there will be an exposure of £500k for at least 5 days during which time the solicitor’s client account bank could go bust. Given the current uncertainty, what is the work-around to this potentially catastrophic situation? Conveyancing solicitors must surely have an answer to this.

3) Or is this a risk which in practice cannot be mitigated or avoided? (:eek: Gulp – who can afford to lose this sort of money?)