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Row over Hamilton&#39s Pru bond deal

Hamilton Life and Prudential have come under fire over an agreement in which IFA clients with maturing investment bonds are being offered Pru bonds instead of being referred back to their adviser.

IFAs are angry that, as their clients&#39 bonds mature, Hamilton Life is not referring them back to adviser but is writing to bondholders enclosing a Prudence bond application.

The industry practice is for providers to contact the advisers six weeks before policies mature.

Hamilton Life, a whollyowned subsidiary of USowned HFC Bank, issued the guaranteed bonds in two tranches six years ago, maturing in April and June this year.

Because of the favour-able terms – protected capital, guaranteed growth of 50 per cent and a bonus – they were sold in large volumes by IFAs.

Thompson Financial Management principal David Thompson says: “This is unethical and unbusinesslike. I am particularly disappointed that the Prudential should want to go behind IFAs&#39 backs in this way.”

HFC Bank director of corporate affairs Martin Rutland says: “Our first letter encouraged people to contact their IFAs and said we would be contacting them with an investment opportunity.

“We did not write to IFAs as we do not have an ongoing relationship with them. There is a commercial agreement in place with Prudential but we are not prepared to discuss details.”

Prudential senior media relations manager Darragh Leeson says: “Third-party mail does not preclude IFAs from dealing with their clients. While IFAs are important to us, there are other channels that we will pursue.”

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