Super Complaint into Cash ISA transfers launched - let the OFT know you views

floss2 · 8 April 2010 at 8:49AM

MSE_Wendy wrote: »

Please let us know...

*the name of your bank Alliance & Leicester

*if your bank does not tell you (or it's really hard to find) the interest rate or product name of your account on statements; I had written information stating my ISA would get a bonus payment - however, this has been overruled and it now earns 0.2%.

*other issues you've had with an ISA in the last few years When I rang to query the interest rate, I got a young woman who insisted that if I wanted to transfer my ISA to another provider, she would have to have details of a nominated bank account to send my money to, then I could put it into another ISA fund. Even I know that doing this would lose me my tax-free status on that money, and she was a bank employee!! :eek:

Thank you for this - hopefully the investigation will bear fruit!

OldBrain · 8 April 2010 at 4:07PM

Towards the end of February 2008 I decided to transfer my Cash ISA from Bradford & Bingley to Newcastle Building Society to take advantage of a higher interest rate. On the 18 March I received a letter from B&B advising that they had closed my account and sent the proceeds (£22,893.66) by cheque to Newcastle BS. After waiting two weeks without hearing from the Newcastle BS I telephoned them on 25 March to be told that the cheque from B&B had “just arrived today” and was in process of being credited to my account.

I immediately rang B&B who assured me that the cheque had been sent on the 17 March and that my resulting loss of interest was not their problem and that I should complain to the Post Office. When I reasoned that I could not complain to the Post Office as the cheque was posted by B&B, they had nothing more to offer. I lost £50 interest as a result of this delay.

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iangcraig · 8 April 2010 at 4:35PM

It took me over a year to transfer an ISA from Barclays to Birmingham Midshires. The money kept being returned for silly reasons (eg. one letter wrong in the post code), but no one ever thought to contact me to tell me there was a problem. The two institutions refused to communicate directly with each other, so I had to act as a go between. I was eventually assured that the money had been successfully transferred, only to find out six months later that it had not. For a while, neither institution knew where the money was! It was eventually traced and I was compensated - but how difficult can it be to transfer a few thousand pounds?

I have just this month 'lost' the tax free status of one of my ISAs. Santander failed to pass a transfer form to Julian Hodge Bank in time for the funds to be transferred penalty free - despite having handed the form in to Santander over three weeks before the Hodge deadline! I guess the good news here is that the 'tax free' status of an ISA these days is worth little, since the banks themselves rake off most or all of the tax money saved.

xiox · 8 April 2010 at 8:09PM

The ISA transfer system is nuts. What the banks should really do is to sort things out electronically, or just wire a sum of money and list of account numbers being transferred daily to the other bank, with some signatures and NI numbers. There's no reason to transfer each account individually.

Lopo · 9 April 2010 at 1:08AM

Greetings all

After many years of building up a nice cash ISA pot with Natwest, it was time to move on to Lloyds for their Fixed Rate ISA (FRISA) of 2008-09 year offering 6.5%. Straight forward with Lloyds...and filled out the paperwork accordingly.

The intention was to basically do a part transfer only of just under £10,000. Natwest however, decided to close the account in full exactly bang on the 30 day transfer date mark, without warning me, and without any consent to do so either. The documents they would have received detailed the requested part transfer figure only - no other instructions.

Much wrangling over the phone later it became apparent they had sent the full ammount to Lloyds after a few worrying days of not knowing what had happened and seemingly just ignored the instructions. Not a major issue you may think, but was annoying as this was not the original result intention and I was fuming.

The big problem was that I needed access to some of the funds within a few months and was the reason for the split in the first place. However, the new Lloyds FRISA had a 90 days interest penalty on withdrawing any funds prior to the FRISA 12-month term length.

So I raised this extensively with Natwest since the error was on their part which took a few days - they offered a laughable £10 compensation over the phone, then £20, then £25, then £100 - and eventually calculated that the penalty of 90 days interest would cost me about £600

.

They agreed after I provided the FRISA terms and conditions detaling the penalty loss I would occur - and thankfully they did the right thing and made a credit to my current account with £600 within hours.

Annoying as hell being put through the mill like this....but worked out quids in at the end of it all...both banks still have my custom, but I'm sooo wary of performing future transfers. My whole experience spanned near 50 days which is just insane.

If you know one banking end has made major error(s) - do not give up, keep pushing and dont let them get away with it. £10....pah!

Hope major changes are forced through....its a sorry state the way it is.

Why it cannot be automated via online banking is the way it should be, would cost them less processing, and involve less errors occuring too.

Good luck all ! :cool:

meredydd78 · 9 April 2010 at 12:38PM

I requested that Kent Reliance transfer my collected ISAs to First Direct on May 20th. 2009, It was only transferred to First Direct on July 8th and only after I had requested that they paid the difference between the two interest acounts for the number of days over a month .:mad:

meredydd78 · 9 April 2010 at 12:42PM

I sent a request to change my ISA from Kent Reliance to First Direct on May 20th 2009. When it became clear that this had not been done within the proscribed 30 days I sent a letter to Kent Reliance requesting that they complete the transfer immediately and send me money equal to the amount that I had been denied (given the difference between the two rates) because they had been tardy in completing the transfer. This they did not do but they the the transfer was not completed until July 8th. I did not even receive an apology.

freighter_2 · 9 April 2010 at 7:33PM

Following on from my previous post [Banks don't like Isa transfers]
I have today opened a new ISA with the Coventry, on line the whole procedure took approx 5 minutes as I was an existing member,why then do transfers take so long and why can't they be done over the internet if you are an existing member of the Bank to be transferred to.
The only thing that is of course taking longer than it should is the transfer of funds from Halifax current account to Coventry. Although Halifax operate the 'Rapid transfer Service' it has yet to accept a transfer to a Bank or Building Society,yet I don't seem to have the same problem when paying bills.
The whole transfer of money between Banks is despite promise still to slow!!!

Red_sky · 10 April 2010 at 5:49AM

I had so many probelms with the Abbey ISA transfer office up in Glasgow. It took them so long to open my new ISA Abbey account that I decided to transfer it to another ISA account before they had even opened it. They never did reply to my chase up letters. Only when I complained to their complaints dept in Milton Keynes did I get any response. WOULD NEVER USE SANTANDER AGAIN. And why do they always send cheques when transferring ISAs. Banks should be able to move money between themselves electronically the same day. I can transfer money using the SWIFT payment system to Vietnam the same day. Why does it take BACS 3-5 'working' days to move money between banks in the UK? I guess so they can earn interest using our money to invest on the overnight interbank interest rate whilst our money is being 'transferred'. That's probably why they send cheques because it takes longer for them to clear ie. they pay us interest up to when they write the cheque ie. close our account then earn interest using our money up until the cheque is cleared by the receiving bank usually about 10-15 days by the time you include weekends and the postal system. I always ask for interest to be paid up until the cheque is cleared regardless of whether they've closed my account. The whole system of moving money between banks needs the FSA to get a grip. Personally, I think the banks regulate the FSA and not the other way around. Faster payments doesn't work either. Wake up FSA and sort these delaying tactics out!

Red_sky · 10 April 2010 at 1:06PM

OldBrain wrote: »

Towards the end of February 2008 I decided to transfer my Cash ISA from Bradford & Bingley to Newcastle Building Society to take advantage of a higher interest rate. On the 18 March I received a letter from B&B advising that they had closed my account and sent the proceeds (£22,893.66) by cheque to Newcastle BS. After waiting two weeks without hearing from the Newcastle BS I telephoned them on 25 March to be told that the cheque from B&B had “just arrived today” and was in process of being credited to my account.

I immediately rang B&B who assured me that the cheque had been sent on the 17 March and that my resulting loss of interest was not their problem and that I should complain to the Post Office. When I reasoned that I could not complain to the Post Office as the cheque was posted by B&B, they had nothing more to offer. I lost £50 interest as a result of this delay.

I had exactly the same problem with B&B but I insisted they pay me interest up until the date the cheque was cleared. The money was quite clearly being held in one of B&B's accounts and not with the post office so it was clearly the B&B who owed you the interest up until the cheque cleared. If they want to post cheques then they should pay the interest that's owed to you up until the money is actually transferred. If I was you, I would have written a complaint to the Chief Executive of B&B then they would have paid you the lost interest or you could have raised a complaint with the FSO.

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Super Complaint into Cash ISA transfers launched - let the OFT know you views

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