Questions of Cash: The Independent

Q.  In 2006 my late mother invested £85,000 in a Halifax Bank of Scotland Guaranteed Investment Plan, placed within a trust with my sister and myself as beneficiaries. The key facts state the aim of the plan as growth, with a guarantee after five years to return at least the value of the original investment.  The investment has achieved no growth.  In January we were told the fund is now entirely invested in fixed interest assets, having moved out of equities to protect the investment in line with the fund’s guarantees.  We chose to close the trust and distribute the funds to the beneficiaries, taking advantage of a tax-efficient option. The closing fund value was £85,117.80.  Should we regard the fund as having achieved the objective of protecting the investment; that it performed poorly, but that it is a case of buyer beware; or that the product was badly conceived and misrepresented?  NK, Surrey.


A.  HBOS is now part of the Lloyds Banking Group, to whom we referred your query.  It argues strongly that the policy was not mis-sold and that the objective of taking out the policy was not only growth, but also to avoid inheritance tax liability.  Had the policy been held for seven years, some £85,000 would have been removed from IHT liability in your mother’s estate.  But the fact that there is a guarantee in place created an extra cost in management charges, which diluted the investment’s possible growth.  Lloyds argues that if no guarantee had been in place and the entire fund placed in equities then the value of the fund might have been less than the original sum invested.  However, Lloyds accepts that your parents were promised in November 2006 that the funds would be invested in March 2007, whereas the investments were actually made in December 2006.  As a result, the funds were subject to a stronger fall in equity values.  Had the investment been made at the time promised, the surrender value would have been £1,616.20 more than you and your sister were paid. Lloyds has now offered to pay you this amount.  You can, though, pursue the matter with the Financial Ombudsman if you believe that you have a case to argue that the policy was mis-sold.


Q.  CarphoneWarehouse closed its Fresh mobile network and told us it would port our two phone numbers to its Talkmobile network on 19 March.  Our numbers should have moved in a seamless switch from Fresh to Talkmobile.  But we were instead given phone numbers belonging to other people.  We lost our calls and received calls for other people.  As a result, I have had to switch-off our mobile banking service and make alternative arrangements to prevent other people from seeing our details. We expect to be compensated, but we do not know the actual losses caused by people not being able to contact us for five days.  DL, Leamington Spa.

A.  CarphoneWarehouse accepts that it ported your Fresh number to its other service incorrectly.  CPW has agreed to pay you compensation of £120, representing £60 per line.  In addition, it will give you a new handset free of charge to replace one of your mobiles that is not working properly.  You suggested to us that you believed the same problem has affected many other Fresh customers.  CPW denies this and says it was caused by “human error”.  It is clear, though, that the transfer of CPW customers from the Fresh to Talkmobile networks has not gone smoothly, as we have received a series of complaints about it.


Q.  BT is attempting to get me to pay a bill that it raised in error. The amount on the bill varies from time to time, but in a letter dated 13 March the amount is set at £181.83 and a debt collecting agency, Credit Solutions Ltd, in letter of 16 March demands £227.29, including their fee.  BT told me on 9 September 2009 that it had written-off the debt.  I moved to my current address on 31 May 2007, ordering a BT landline service before I moved.  The line was only connected in the late summer, apparently because BT was very busy.  I later ordered and received a BT broadband service. I pay my BT bills regularly.  I had complained to the CEO’s office in spring 2007 about the failure of BT to provide a phone line and I was phoned by BT, who explained that BT had processed four separate orders for me.  The operative cancelled three of the orders and the bill I am being chased for appears to be the cancellation fee for those three orders.  I have repeatedly been promised that this was resolved.  SM, Northumberland.

A.  BT has agreed to write-off the debt, cancelled the debt collection instruction to Credit Solutions Ltd and has credited your account with £50 as a goodwill gesture in recognition of its poor level of service to you.


Q.  I read about the problem of a reader in getting a refund for a flight cancellation from easyJet (Questions of Cash, 13 March).  I have yet to hear back from easyJet on a similar claim that I submitted on 6 January.  My flight from Munich to Manchester on 20 December was cancelled and the ‘replacement’ flight to Gatwick the following day was also cancelled.  We managed, with difficulty, to get back to Manchester on 22 December via a flight to Edinburgh, staying overnight. Given the very poor weather conditions, easyJet did its best to provide a decent hotel and transfer in Munich, but we have not even had an acknowledgement that it received our claim.  KH, Manchester.


A.  EasyJet apologises and accepts your claim should have been dealt with earlier.  It says the delay was caused by “an oversight”.  It has now agreed to offer you a refund of £338.70, comprising £231.20 for your additional flight purchases, £50 for hotel accommodation, £40 for food and £17.50 for taxis.

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