Questions of Cash: September 2014

Posted on November 6, 2014 · Posted in The Independent

Q. My wife and daughter own a three bedroom house in County Durham, rented out through letting agents. Currently, the house is rented out to a tenant on housing benefit. The rent is £87.70 and £86.54 of this is supposed to be paid directly by Durham County Council as housing benefit to the letting agent. Under the ‘paper bond scheme’, the property was rented out to the tenant from 28 February this year without a deposit, with any damage paid for by the county council. As part of this scheme, the property was inspected by the council and had to be brought up to their standard – at our cost – prior to the let being approved.  It took Durham County Council until the end of July to start paying the rent.  At present, the council owes arrears of £380 as they have not paid the rent for several weeks. The council says the tenant was late in providing information and they cannot back date the claim to the end of February. This decision is subject to an appeal, which is being organised by the letting agent.  Can you assist with getting this resolved?  AG, Durham.

A. Durham County Council has now agreed to pay the outstanding housing benefit. Ian Ferguson, revenue and benefits manager at Durham County Council, says: “We have looked at the circumstances with regards to this complaint and have been able to resolve matters. We are in the process of writing to the tenant and the landlord to inform them of the outcome and to make the appropriate back-dated payments.” Your wife and daughter receive housing benefit payments slightly less than the rental rate they have set because housing benefit is capped on the basis of local market conditions, using a ‘local housing allowance’.

Q. I have a portfolio of funds, comprising about £500,000 in a SIPP [self-invested personal pension], £250,000 in an ISA and £100,000 in a fund and share account. All are held in Hargreaves Lansdown’s Vantage ‘supermarket’ platform. But when Hargreaves Lansdown announced in January that it was increasing its charges I decided to move to Interactive Investor, who would be more cost-effective for my portfolio. I completed the forms and was told the transfer would take between six and eight weeks.  Seven months later, the transfer has not been completed, despite me writing repeatedly to both Hargreaves Lansdown and Interactive Investor.  The ISA & share & fund account took roughly three months to completely transfer and the SIPP has been partially transferred. The cash element, which should be the easiest and quickest to transfer, is not to be transferred until all the other transfers are completed. I sold all my shares in the SIPP before the transfer, so there is a cash figure of over £50,000 which has been in limbo since January and which I have not been able to re-invest and trade. I’ve lost at least £1,000 in the past seven months.  Interactive Investor has offered me £100 in trading credits as a full and final settlement of my complaint.  This does not nearly cover my losses and the problem is still not solved – I’m waiting for £193,000 of funds and cash to transfer. MC, London.

A. We can report that the transfers are now fully completed. Hargreaves Lansdown accepts that it failed to make one transfer when it should have done, while it claims that other transfers were delayed because of administrative changes to fund management that were simultaneously taking place at Interactive Investor. We are told by Interactive Investor that Hargreaves Lansdown transferred the SIPP to the wrong fund on 23 June and it was only after we contacted the two companies at your request that your money was located and transferred on to Interactive Investor. Danny Cox of Hargreaves Lansdown says: “Due to the nature of investments, the transfer process can be a lengthy one, but it is clear that on this occasion [the reader] did not receive the usual high standard of service we aim to provide to our clients. As such we have offered a refund of the £75 exit charge plus offered £100 for his inconvenience which [the reader] has accepted.”

A spokeswoman for Interactive Investor denies that it is to blame for the delays. She says: “We are deeply unhappy with the length of time [the reader’s] transfer has taken. In reflection of this, we have offered [the reader] an additional £250 [trading] credit as a gesture of goodwill.  This is to acknowledge the unexpectedly long and frustrating experience he has had.  In cases where funds are being transferred to us, we are not in full control of the timeline and are dependent on the existing provider and other parties such as the transfer agent, the fund manager, and the custody platforms. We have done everything possible to collaborate with Hargreaves Lansdown and the other parties involved.”

We are unhappy with this outcome as, by your calculations, you have suffered a significant loss for which the two companies have not fully compensated you. You say that you are unable to accurately calculate that loss.  You have chosen to accept the compensation offered to you.

Q. I stayed at a New York hotel in April. My fourth night was ruined because of a generator running outside my room for most of the night. I complained at the time, but the hotel manager was not interested. The hotel responded to my letter of complaint by agreeing a 50 per cent refund for one night – which would be £78.47. But the hotel then said it had already refunded $90 (£55). I have still not received this.  JG, by email.

A. We raised this with Agoda, through whom you booked the accommodation. It tells us that it has now processed the agreed refund. You say: “I have just received a statement for my credit card showing that Agoda have credited my account with £75.37. [In addition,] Agoda have offered me a 15 per cent discount on my next booking.”