Barclays protestors get MPs' backing
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Parliament protest: Barclays investors in Westminster this week
MPs have pledged to help scores of elderly Barclays clients who have lost hundreds of thousands of pounds, which they blame on poor advice from the bank.
Over 80 former Barclays clients gathered at Westminster on Tuesday to protest to MPs about their losses after Barclays salespeople advised them to invest in the Aviva global balanced income fund.
In April last year, Money Marketing revealed that Barclays advised cautious clients approaching or in retirement to transfer their long-term savings into the single specialist fund.
The value of the fund almost halved in the 12 months to March 2009. The bank admitted it erroneously categorised the fund as balanced rather than adventurous between July and November 2007.
Conservative MP for Wimbledon Stephen Hammond chaired the meeting in the House of Commons after a constituent, Lona Fudge, lost half of her £108,000 investment in the fund.
Fudge said: “I invested £108,000 in 2006 and by February 2009 my investment was worth just £54,000, even though I told Barclays I did not want to risk my capital. Barclays has made me a poor pensioner.”
She says Barclays offered her £36,100 in compensation but she has rejected the offer and now has a complaint with the Financial Ombudsman Service.
Many investors have been waiting for over a year for their complaints to go through the FOS and Barclays has, in some cases, refused to accept decisions from adjudicators, which lengthens the process further.
Hammond urged investors who have lost money because of Barclays’ advice to invest in the Aviva fund to contact their MP.
Other MPs who attended the meeting included Conservative MP for Daventry Chris Heaton-Harris and Conservative MP for mid-Norfolk George Freeman.
Heaton-Harris told investors MPs will raise the issue in the Commons.
He said: “Barclays is trying to settle a lot of complaints outside of the judicial process, which suggests it has a reason to do so. Hopefully, with a joint effort from a number of MPs, we will be able to do something about it.”
No one from Barclays attended the meeting but a spokesman says: “It is clearly evident that in some instances relating to these funds, we have failed to meet the high standards that our customers expect from us.”
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Readers' comments (4)
Anonymous | 22 Jul 2010 9:19 am
Good article. The best part is that you highlight that Barclays employ salespeople, not advisers. Secondly, quite outside the recommendations made by the FSA with respect to asset allocation and risk, they invest clients money in one fund, which just happens to be mis-categorised as having lower risk than it should. Any adviser worth his salt would look at the name and seeing 'global' and 'balanced' would know it was not suitable for a cautious investor. It does make one think that Aviva had offered 'terms' to Barclays to encourage 'sales' of this fund. High standards and expectations, mmmnnn
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Anonymous | 22 Jul 2010 9:45 am
Quick someone show this to the FSA so they can see it’s not always the ‘big bad IFAs’ ripping off little old ladies.
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Julian Stevens | 22 Jul 2010 10:22 am
But why are MP's having to "help scores of elderly Barclays clients who have lost hundreds of thousands of pounds which they blame on poor advice from the bank"? Surely, this is the responsibility of the FSA, whose central remit is to protect consumers and, as the FSA is forever banging on about, ensuring "better consumer outcomes".
What this report this tells us loud and clear is that when it comes to misdeeds on the part of the banks, the FSA is conspicuously MIA. But if the guilty party is an IFA firm or a network, the reaction of the FSA is totally different, followed by a report on Margaret Cole crowing about how the FSA "has acted swiftly and decisively to protect consumer interests". Selectively.
Surely, these aggrieved customers shouldn't be complaining to their MP's just about the bad advice given to them by Barclays, but about the manifest lack of action on the part of the FSA to do its job, not just properly but at all.
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Anonymous | 22 Jul 2010 11:50 am
How Barclays could possibly classify a fund investing nearly 60% of its assets into equities and 80% into overseas holdings is beyond me!
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