The Endowment Diary

The Endowment Diary


The Endowment Mis-selling Debacle - one of the UK's worst financial scandals

Sunday, March 23, 2003

Extract of letter sent today to company A, and copied to The Times:

"..Thank you for your letter dated 14 March (ref OUT). I note its contents.

However, I have the following observations:

 You state that B were not acting as agents of A. However, when I took out my endowment (on the advice of B) they offered only A as an endowment provider, no other companies or products were offered. This to me indicates, at the very least, a “quasi” agency relationship between B and A.

 I assume that B received commission for the sale. Again this indicates to me a “quasi” agency relationship between B and A. Please can you clarify your reasoning for stating that they were not acting as an agent for you.

 You recommend that I contact the Financial Services Ombudsman. This surprises me, as you will have seen from my original letter (dated 23 January) that I have already written to the Ombudsman. In fact, the letter I sent you included a copy of their questionnaire relating to the policy. Their response noted that they could not act, as the endowment was taken out pre 1988.

 Additionally, my letter of 23 January noted the following; quote:

“I completed the Financial Ombudsman Endowment Mortgage Questionnaire, which I despatched in November. They have advised me that I should raise this matter with the product provider; ie yourselves.”

Please can you clarify why you feel I should raise this matter with them again?

It is my understanding of the law of agency, that the principal is liable for the actions of the agent. The Consumers’ Association advise that where:

 the endowment policy was sold pre 1988, and

 the agent (B) refuses to take responsibility for mis-selling;

the principal (A) should be approached, and redress claimed from them.

I contend that B were acting as agents for you, and as such, I reiterate my claim for redress on the basis of mis-selling.

Your letter states that you would like to assist me in progressing my complaint. In addition to clarifying the above queries, I would appreciate the return of the attachments that I sent to you on 23 January, namely:

 The Endowment Questionnaire.

 My letter to B's raising the complaint (dated 11 October 2002).

 B's acknowledgement of receipt (dated 21 October 2002).

 The rejection from B's Compliance and Quality Control Director (dated 28 October 2002).

 My response to their rejection (dated 4 November 2002).

 B's acknowledgement of this (dated 7 November 2002).

Thank you in advance...."

Saturday, March 15, 2003

I received a letter today from company A, in respect of my complaint about the mis-selling of my first endowment policy. Extracts as follows:

“…I am sorry to inform you that A are unable to investigate your complaint, as the advice you were given on the sale of the above plan was by an Independent Financial Broker (editorial note this was company B)…

B were not acting, as agents of A but were your own chosen Financial broker…we had no control over the advice that they gave you…

If you feel that you have received an unsatisfactory reply from B, please contact the Financial services Ombudsman service…”

I have the following initial observations:

1. I am sure, but will check my records, that B would have been receiving commission payment for selling A’s policies. This, at the very least, would place them in a quasi agency role.

2. The advice re contacting the Ombudsman is spurious, I have already done so and was told that as the policy was sold in 1987 the legislation does not cover my claim. Indeed the Ombudsman recommended that I contact A!

3. I detailed the last point in my original letter to A, even including the correspondence between myself and the Ombudsman together with the detailed endowment complaint questionnaire. The fact that A now recommends me to contact the Ombudsman indicates to me that they have not read my letter.

This is not the end of the matter as far as I am concerned. I will go through my records and decide what to do next.

Tuesday, March 11, 2003

Extract of a note sent in response to one received from a surfer yesterday:


Thanks for the note.

Securing compensation, or indeed a response, from these companies is a very very long you know, and as you can see from my own experiences.

Let us hope we are still young enough, and fit enough, to enjoy it when they finally come up with some compensation!

best of luck.


Saturday, March 08, 2003

I think more butt kicking will be required, given this protracted delay. I will take action during the coming week.