Parliament protest and BBC pile pressure on Barclays advice
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Scores of elderly Barclays clients protested in Parliament this week about the investment advice they received from Barclays.
Meanwhile a BBC docomentary, to be screened tonight, will also shine a spotlight on the financial advice given by the bank.
More than 80 former Barclays clients gathered at Westminster on Tuesday to tell 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 Barclays advised cautious clients approaching or in retirement to transfer their long-term savings into the single specialist fund.
The value of the fund plunged by almost 50 per cent in the 12 months to March 2009 and the bank admitted it erroneously categorised the fund as balanced rather than adventurous between July and November 2007.
A BBC2 programme, How to Beat Tough Times: Money Watch, will tonight highlight problems investors have faced after taking financial advice from Barclays.
Conservative MP for Wimbledon Stephen Hammond, who chaired the meeting in the House of Commons, urged other investors who have lost money because of Barclays’ advice to contact their MP.
Other MPs that attended the meeting included Conservative MP for Daventry Chris Heaton-Harris and Conservative MP for Mid Norfolk George Freeman.
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.”
For the full story, plus pictures, see this week’s issue of Money Marketing.
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Readers' comments (18)
Julian Stevens | 21 Jul 2010 4:37 pm
It's a pretty appalling indictment of the FSA when more than 80 clients have to protest outside parliament due to lack of action on the part of the regulator. Were an IFA firm or a network the guilty party, one of Hector's Hatchet Squads would be down on it like a hundred tons of hot bricks ~ wouldn't they?
Will a spokesperson for the FSA be appearing on tonight's BBC programme to explain why it [the FSA] has failed to act? Or will it be another case of "No one available for comment"?
And still we know not why the FOS adjudicators were given "special training" on how to handle complaints against Barclays. Anyone?
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Anonymous | 21 Jul 2010 4:42 pm
Can't expect the FSA to act if it might damage their career prospects.
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Bob Perry | 21 Jul 2010 4:51 pm
This issue is not just related to one product. I am currently dealing with a Barclays client, horrified that his investment has made no money over the past 5 years. He tells me his adviser told him that his investment would "do very nicely and make a good profit". Sadly, many people still trust the banks. This trust is sorely misplaced.
His adviser was driving a brand new red Porsche at the time.
The problem is that bank salesforces are target/commission driven. Their number one priority is not necessarily what's most suitable for the client.
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Benedict Hope | 21 Jul 2010 4:53 pm
Not only Barlcays and banks in general that engage in this sort of practice though.
Apparantly there are a fair few 'advisory' firms that are falling very short of Treating Clients Fairly.
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PAUL FIELDING | 21 Jul 2010 5:03 pm
Now then FSA....will you please all be big enough to acknowledge that banks do NOT offer advice....they SELL products...
....if you don't believe this to be true, don't ask the bosses who will just fob you off over an expensive lunch....ask the poor sods whose line managers harangue them to sell, sell, sell at the counter, to meet the targets set by those at the top......
If these poor 80 people who were protesting, had been subject to such appalling treament by IFAs....(a) the business wouldn't have got past the compliance stage - it would have been thrown back at the adviser....(b) there would have been a public outcry of huge proportions and (c) perhaps most interestingly, we'd have the FSA trumpeting the fact that they were going to take those advisers to the cleaners and back, banning them from the industry and levying massive fines.....
....and to think that a massive majority of FSA people are on BONUSES for this kind of monumental failure....this is no longer a regulatory OR Governmental issue....it's far more important than that....this is an issue of enormous and fundamental national importance to the financial well-being of citizens in this country....come on Hector et al...no more hiding places.......it's all out in the open....it's on BBC, by the way....
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Duncan Carter | 21 Jul 2010 5:39 pm
To be fair [sic] to Barclays, it's not just them!
I have seen similar behaviour from Lloyds TSB.
In one case a woman who can barely read is having to carry on working to pay off the loan and PPI she was 'advised' to take out to as the APR was cheaper than an existing loan.
It wasn't and there were early redemption charges on the existing loan. The capitilisation of the PPI on top of the loan and interest added to it added 35% to the loan.
Lloyds rejected her complaint on the grounds that their staff are trained to do things properly and in any event she'd signed the various documents the seller had shoved under her nose.
It's now with FOS so let's see what they make of it but if anyone from the FSA is reading and wants more details, I'd be happy to supply on this and other cases.
Sadly this lady trusted the bank as she's been with them for 40 years.
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Exasperated me | 21 Jul 2010 7:03 pm
I spent more time unpicking the mess that the banks (and DSFs) had made than I did on my own new business, unfortunately unpaid social service doesn't pay the bills.
I bet you all know know how that feels, well maybe not all of you.
What I find disgraceful is the fact that the regulator set up to ensure that consumers receive a fair deal stands back, or is does it look the other way?
Regulation as we know it is bust.
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Julie | 21 Jul 2010 7:09 pm
Duncan Carter
Having successfully aided a client to take a complaint against Lloyds TSB to FOS a couple of years ago - she should get her money back regarding PPI. My clients had banked with them for 15years, then decided to buy a shop. Lloyds promptly banged on a PPI for £24K to a £100K loan. The client ended up in hospital with suspected heart attack when she found out, what they'd made her sign.
It took 3 years but they were made to pay every single penny back to the clients...over £11K in all plus interest.
It's quite simply the worst case of financial advice I have ever seen, to make a start up business pay interest on the loan for PPI of £237 per month ontop of the loan used to buy the business, is completely immoral...
One of my colleagues who is a lovely guy & used to do his best for customers but left the bank when all his job became was meeting weekly targets & bullying his staff.
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Marc Duff | 21 Jul 2010 10:11 pm
In response to Julian Stevens' comments, the IFA Sector has had light tough regulation for nearly 2 decades, so don't give me that !
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Anonymous | 21 Jul 2010 10:52 pm
Not the banks mis selling again, who would have thought that..........adding up all the instances over the years surely they should have had their licence revoked by now (dont be silly, they feed the FSA)
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