Questions of Cash: The Independent

Q. I had a Post Office Travel Money Card, which contained a balance of €140.19 when it was withdrawn at the end of last year. I was given a refund of £108.67, which used a very poor exchange rate. I have complained to the Post Office, but it has rejected my argument. CV, Cirencester.

A. Your Travel Money Card expired in December, after the Post Office decided that these products would not be renewed. You have a good argument: the exchange rate used for your refund was €1.29 to the pound. The current market rate is €1.14 and it was €1.16 at the turn of the year. But the Post Office calculated its refunds using its own buy-back rate as at 14 March this year, when the market rate was less favourable – but even so was under €1.20. It says it is unable to make refunds in euros, or any currency other than sterling. The Post Office has therefore rejected your complaint. However, it is sending you £25 as a goodwill gesture in recognition of the long delays in firstly dealing with the complaint you made directly and then in responding to our repeated complaints on your behalf. This more than covers your loss.

Q. On 7 May you published a question from a reader struggling with the administration of a stockholding in Dr Pepper Snapple Group which, as a US company, required a Medallion Signature Guarantee (MDS) for the stock to be transferred.  I had a similar problem as executor of my wife’s estate.  She held stock in Dr Pepper Snapple consequent on the demerger of Schweppes from Cadbury Schweppes in 2008. I required an MDS to transfer the stock and then effect the sale. I made enquiries and found IWC Estate Management Ltd of Croydon who quoted a fee of £295 plus VAT to obtain the MDS.  The MDS box was stamped by HSBC Securities (USA) Inc. In June received a cheque in dollars. AW, Southampton.

A. As we explained in May, we spoke to the two legal firms quoted by the US Embassy as carrying out the
Medallion Signature Guarantee procedure, neither of whom now does so. The Securities and Exchange Commission in the United States suggested that some US banks with offices in the UK may offer the service here, but the banks we spoke to with operations in both countries said they did not offer this service to UK clients. On the basis of your letter we approached HSBC – which was not one of the banks we approached previously – to ask if it provides this service to UK clients. It confirms that it does, at a charge of £50 per transaction: it normally takes between two and six weeks.

Q. I recently took out a 0 per cent transfer with Barclaycard, at a cost of a 2.9 per cent fee. I feel there are hidden charges not spelled out by Barclaycard. Although the rate is 0 per cent on the transfer, any purchases made within the ‘interest free’ period are charged from purchase date – I’ve lost the 56 days to clear balances without charge. I have read the Barclaycard literature and cannot find any clear statement warning of this. The sensible solution is not to use the Barclaycard, which cannot be the intention of the promotional offer! IG, Scarborough.

A. Your situation is a reminder that an interest free credit card balance transfer is not the same thing as a free of charge transfer. Although you do not pay interest on the balance you transferred, you do pay interest – at 12.9 per cent, with Barclaycard – on the cost of goods and services you buy on your credit card as soon as you buy them. By taking advantage of the balance transfer, you lose the usual interest free period of 56 days in which to pay for the items. This is the same as if you withdrew cash on your credit card. Barclaycard says its treatment of balance transfers is standard practice. A spokesman explains: “As is common across the credit card industry, our customers benefit from an interest free period on purchases when they clear their balance in full each month, or where the card has an explicit interest free period on purchases. We are completely transparent about this being the case on our website and in the way we explain our products. When customers have balances that attract different interest rates, payments made to the account are applied to balances attracting higher interest rates first.”

Q. The banks are being forced to pay compensation for the mis-selling of payment protection insurance on loans. I obtained a mortgage from the Skipton Building Society in 1999 and a condition of the loan was that I obtained from them either an ASU [accident, sickness, unemployment] insurance policy, or a buildings and contents policy. Am I entitled to a refund? SW, Bristol.

A. You took out the ASU policy to avail of a lower interest rate mortgage. You could, alternatively, have taken out a buildings and contents policy, but given your home’s history of subsidence you decided that it was important to have continuity of insurer. Skipton Building Society argues that you benefited from the ASU policy and that there is no suggestion that as an employed teacher you would have been unable to claim on it. Skipton has therefore rejected your request for a refund of premiums. It points out that the interest rate on your mortgage was reduced significantly compared with the standard mortgage available had you not taken out a linked insurance policy. Skipton also suggests that you should have relied on advice from an IFA when taking out the products to ensure they provided you with the best value available. We have checked with the Financial Ombudsman Service, which confirms that the compensation arrangements for PPI mis-selling do not cover instances where a policy was sold as a condition for the sale of another financial product and where the policy provided real benefit.

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