From Barry Cash
Whilst I entirely agree with last week's Letter of the Week (Mortgage Strategy June 21) I can't help feeling that as an industry we are largely responsible for the bad press we receive.
In 1976, long before I entered financial services or understood anything about them, my wife and I decided to get one of the new-fangled endowment mortgages. We had no way of knowing if this was a good deal – it was really a gamble. Our mortgage was for the then staggering sum of £9,000 over an unimaginable 25 years. After tax relief the premium was £14.94 a month or a total over 25 years of £4,482. In 2001 the policy matured at £30,567. I thought that was pretty good and asked my local paper if they wanted some good news about endowments. They did and I was asked to write an article. Alas, I moved companies and that together with work pressures meant I never got around to it. But at least I can't blame the press for not printing it can I?
But it is a fact that the practices of some major companies and the regulator leave much to be desired. A few years ago my wife had a loan from a respected bank. It telephoned and tried to sell her insurance to meet payments in the event of accident, sickness or unemployment. She pointed out that as she was unable to work because of ill health, unemployment insurance wasn't really much use. The bank told her it didn't matter, she could still take it out even if she wasn't working. It did this several times. So when I had occasion to take the matter of the loan to the banking Ombudsman I included the attempted sales in my complaint, the grounds being that the bank had broken the Banking Code by failing to help her 'choose a product or service suitable to her needs'.
The Ombudsman ruled that as she had not taken out the insurance she had not 'chosen a product or service' and therefore the bank could not have broken the code, in effect saying that the Ombudsman will only help those who do not realise they are being sold the wrong product and therefore will not complain about it.
Is it really surprising that some sections of the media regard financial services as fair game?