Ask Sindie: 'My endowment mis-selling claim led to a dead end'

Can you still get compensation if your adviser has stopped trading?

I have recently written to my endowment company to complain about a possible mis-sold policy.

I was told to contact the financial advice and insurance intermediary that had sold the policy to me. But when I did, I discovered this company was no longer trading.

Can you please advise me what to do next?

PM, via email

Not all is lost for the consumer when a company stops trading. But much will depend on whether it's gone bust, slipped into administration or changed into a new firm altogether.

As a customer with a complaint over a possible loan mis-sale, you first need to establish the precise status of the company you bought the product from, says Emma Parker, a spokeswoman for the Financial Ombudsman Service (FOS).

If the intermediary has stopped trading and is waiting to be wound up, it could still have some assets left. In this case, the FOS will take charge of your mis-selling complaint.

But if the original company has stopped trading under its old name and is continuing under a new one, you may be able to pursue your mis-selling claim yourself - backed up by the FOS if you get nowhere, Ms Parker says.

There could be a fly in the ointment here, though. The business may be trading in new guise but have ditched its old liabilities - including any responsibility for your policy. In this case, you would need to contact the Financial Services Compensation Scheme (FSCS) for help.

Finally, if the company has simply gone bust, you should again contact the FSCS, which will handle your mis-selling claim. A £48,000 limit applies to any compensation paid.

If, in any of these scenarios, a mis-sale is found to have taken place, you'll be eligible for compensation. This is usually worked out by comparing your current financial position with what it would have been had you taken out a repayment mortgage.

However, there is a further complication in each of these scenarios. If you were sold a policy before 29 April 1988, you won't qualify for help from the FOS. And if the sale was before 28 August in the same year, you won't be eligible for assistance from the FSCS.

Essentially, this is because rules on the selling of endowments were tightened from then on. So if you were mis-sold the policy before the above dates, sadly, you won't be able to claim any compensation. Hopefully, though, you'll be one of the 90 per cent of claimants who were sold endowment mortgages after the 1988 cut-off dates.

The good news is that help is available to you to determine the current status of the advice company that sold you the policy. Try the Financial Services Authority's consumer helpline on 0845 606 1234; the FOS on 0845 080 1800; or FSCS on 020 7892 7300.

I've had two mailshots from the Children's Mutual land on my doormat, advertising its child trust fund [CTF].

My baby is two months old and I know I should be thinking about the best way to invest the £250 [voucher, available to all children born after 1 September 2002]. But I really don't have the time to go and see anyone.

My bank (Barclays) has also been in touch but I'd rather not have all my money with one provider.

Can I simply save time and go with the Children's Mutual?

LF, Norwich

No doubt it feels like a chore but you really should make time to consider the options for your baby.

That £250 voucher is to be locked away - along with any other money up to £1,200 that you can afford to invest tax-free each year - for 18 years. Over this long a period, there will be great potential to generate a handy lump sum when your child comes of age.

There are basically three options available to you.

Put the voucher into a cash deposit fund, where it will earn between 3 and 5.5 per cent interest a year.

Or invest in a cheap-to-run shares fund with a "lifestyling" facility that switches the cash into safer deposit accounts once your child reaches the age of 13.

Or you could opt for a riskier shares fund with higher annual charges.

The decision will come down to your attitude to risk. You need to be happy with where you're putting the money - whether it's earning a steady interest rate in a bank or building society, or generating possibly higher returns in a shares-based fund that might also fall in value if the stock market falters.

Some independent financial advisers recommend sticking the cash in shares, arguing that, over such a long period, any downturn in the markets will be smoothed out. But others argue that a deposit account will give parents peace of mind.

Take 30 minutes to log on to, a government-sponsored website, and click on its "Use our toolkit" icon. This offers useful advice and includes a list of providers.

If you need help from our consumer champion, write to Sindie at The Independent on Sunday, Independent House, 191 Marsh Wall, London E14 9RS or email We cannot return documents, give personal replies or guarantee to answer letters. We accept no legal responsibility for advice given.

Finacial products from our partners
Property search
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Ashdown Group: Editor-in-chief - Financial Services - City, London

    £60000 - £70000 per annum + benefits : Ashdown Group: A highly successful, glo...

    Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

    £25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

    Guru Careers: Management Accountant

    £27 - 35k + Bonus + Benefits: Guru Careers: A Management Accountant is needed ...

    Guru Careers: Project Manager / Business Analyst

    £40-50k + Benefits.: Guru Careers: A Project Manager / Business Analyst is nee...

    Day In a Page

    General Election 2015: ‘We will not sit down with Nicola Sturgeon’, says Ed Balls

    'We will not sit down with Nicola Sturgeon'

    In an exclusive interview, Ed Balls says he won't negotiate his first Budget with SNP MPs - even if Labour need their votes to secure its passage
    VE Day 70th anniversary: How ordinary Britons celebrated the end of war in Europe

    How ordinary Britons celebrated VE Day

    Our perception of VE Day usually involves crowds of giddy Britons casting off the shackles of war with gay abandon. The truth was more nuanced
    They came in with William Caxton's printing press, but typefaces still matter in the digital age

    Typefaces still matter in the digital age

    A new typeface once took years to create, now thousands are available at the click of a drop-down menu. So why do most of us still rely on the old classics, asks Meg Carter?
    Discovery of 'missing link' between the two main life-forms on Earth could explain evolution of animals, say scientists

    'Missing link' between Earth's two life-forms found

    New microbial species tells us something about our dark past, say scientists
    Ronald McDonald the muse? Why Banksy, Ron English and Keith Coventry are lovin' Maccy D's

    Ronald McDonald the muse

    A new wave of artists is taking inspiration from the fast food chain
    13 best picnic blankets

    13 best picnic blankets

    Dine al fresco without the grass stains and damp bottoms with something from our pick of picnic rugs
    General Election 2015: Ed Miliband's unlikely journey from hapless geek to heart-throb

    Miliband's unlikely journey from hapless geek to heart-throb

    He was meant to be Labour's biggest handicap - but has become almost an asset
    General Election 2015: A guide to the smaller parties, from the the National Health Action Party to the Church of the Militant Elvis Party

    On the margins

    From Militant Elvis to Women's Equality: a guide to the underdogs standing in the election
    Amr Darrag: Ex-Muslim Brotherhood minister in exile still believes Egypt's military regime can be replaced with 'moderate' Islamic rule

    'This is the battle of young Egypt for the future of our country'

    Ex-Muslim Brotherhood minister Amr Darrag still believes the opposition can rid Egypt of its military regime and replace it with 'moderate' Islamic rule, he tells Robert Fisk
    Why patients must rely less on doctors: Improving our own health is the 'blockbuster drug of the century'

    Why patients must rely less on doctors

    Improving our own health is the 'blockbuster drug of the century'
    Sarah Lucas is the perfect artist to represent Britain at the Venice Biennale

    Flesh in Venice

    Sarah Lucas has filled the British pavilion at the Venice Biennale with slinky cats and casts of her female friends' private parts. It makes you proud to be a woman, says Karen Wright
    11 best anti-ageing day creams

    11 best anti-ageing day creams

    Slow down the ageing process with one of these high-performance, hardworking anti-agers
    Juventus 2 Real Madrid 1: Five things we learnt, including Iker Casillas is past it and Carlos Tevez remains effective

    Juventus vs Real Madrid

    Five things we learnt from the Italian's Champions League first leg win over the Spanish giants
    Ashes 2015: Test series looks a lost cause for England... whoever takes over as ECB director of cricket

    Ashes series looks a lost cause for England...

    Whoever takes over as ECB director of cricket, says Stephen Brenkley
    Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

    Fishing is on Nigel Farage's mind

    Ukip leader casts a line to the disaffected