The Endowment Diary

The Endowment Diary


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

Monday, December 20, 2004

Trouble Ahead

It is reported that the Financial Ombudsman Service (FOS) has warned that it won't be unable to cope with the mortgage endowment complaints, next year; as there is expected to be steep rise in these complaints.

The rise in endowment complaints is expected, because the large life assurance companies will be sending out letters in the New Year to their policyholders; these will warn them about the 3 year time-bar rule.

Policyholders have 3 years from receipt of the first warning letter to complain.

The FOS is now getting fed up with endowment providers, who are disregarding complaint handling guidelines.

"..Some firms are systematically rejecting swathes of complaints with little or no investigation..."

It is reported that Halifax and Abbey National are among the names passed on to the FSA, by the FOS, in respect of shortcomings on complaint handling.

The FOS wants steps taken to force providers to settle cases themselves.

Wednesday, December 15, 2004

The Costs Begin to Mount

The costs of compensating people for being mis-sold underperforming, and useless, endowment polices is beginning to bite into life assurance companies profits.

Lloyds TSB yesterday announced that it has had to set aside a further £110M to compensate customers, who were mis-sold endowment mortgages.

This brings their total provision for mis-selling endowments to £360M.

Tuesday, December 14, 2004

Endowment Claims Cost HBOS £40M

HBOS bank has earmarked approximately £40M, in compensation for customers who may have been mis-sold underperforming performing endowment mortgages.

HBOS has reportedly admitted to an increase in the number of endowment cases being compensated, and said the precise figure will emerge in an exceptional provision in the 2004 results.

Wednesday, December 08, 2004

A Slight Untruth

My dear friends at my life assurance company wrote to me today, in connection with my ongoing enquiries into how much commission they are charging on my two endowment policies.

Here is an extract of the letter, signed by their Customer Service Agent:

"Thank you for your telephone call on 30 November 2004. I apologise for the delay in my reply.

Unfortunately, due to systems limitations I am unable to advise you of the commission charges that have been paid on your policy...

I am sorry I can be of no further assistance

I would make a simple observation here.

The company is one of Britain's largest, and best known, life assurance company. They handle billions of pounds of investments, and have very sophisticated management information systems monitoring returns, payments, income etc.

Do they seriously expect me to believe that they do not keep records of commission payments?

Friday, December 03, 2004

Formal Complaint

I have made a formal complaint to the Financial Ombudsman Service, about the obstructive and unhelpful attitude of my life assurance company; in respect of my enquiry about commission payments made on my endowment policies.

I have also copied all correspondence on this matter to the Treasury Select Committee.