Financial farrago in the case of my missing PEP
Having spent years telling other people how to handle their money, Martin Baker admits he's made a mess of things here.
Saturday 23 June 2012
This is a story of organisational anarchy, financial fiasco and muddled money management – partly other people's, but mainly my own. If I were a physician, I'd be so far from curing myself I'd be six feet under by now.
As things stand, I've managed to lose more than £15,000 and also, possibly (the longer this saga draws on, the truer this statement becomes) my sanity.
All of which would be bad enough in itself. But consider this: for more than two decades I used to be a journalist, dispensing "wisdom" on the importance of saving up and taking control of your finances.
So then, here's the tale, in all its awful vagueness.
In 1998, or possibly 1999, I bought a PEP (it couldn't have been an ISA, because they weren't introduced until April 1999). The tax-advantaged investment – ISAs and PEPs are onshore tax havens – was invested in Baring Asset Management's UK Smaller Companies fund, a unit trust.
I remember making the investment. I have what's known in cognitive analysis as a "memory anchor" – I wrote a long piece on small-company investment for a magazine, and thought I'd commit some cash myself.
I spent most of 2000 on gardening leave. From my metaphorical garden shed I set up a portfolio tracker with www.iii.co.uk.
I must have had some materials from Baring Asset Management at this time, as I entered a specific number of units in the tracker. I have a hard copy of a portfolio page, stating that the number of units was 4,687, according to a printout of my portfolio that I made (thank heavens) in late 2010.
I subsequently made a classic mistake – I believed the screen I was looking at to represent the truth. I monitored my investments online for several years, but cannot recall receiving annual reports from Barings, the managers.
Like most investors, I would have thrown them away after a quick perusal – as I did with investments run by other managers, such as Investec, Fidelity, etc.
In April 2011 I logged on and got a shock: The Barings fund was valued at zero. I called the custodians, and discovered it had been wound up; I should expect to receive a cheque.
My initial disappointment centred on the fact that I'd lost a year's worth of tax-free investment.
Still, the £6,000 or so had turned into £15,000-plus over the years – not great, but not bad. It's been a year now. But I've received nothing – the back offices at Barings and the various advisers I've used cannot trace my investment.
My first point of call was Barings. They've been courteous and helpful. But it seems that they can't find my name on their systems. Nor can they find my National Insurance number.
They say that I must have used an IFA (Barings weren't offering this fund at the time direct to the public as a PEP, so I would have had to). The investment has to be in a nominee (group holding) account.
My second try was the IFAs. I couldn't be sure, but maybe I'd invested via Brooks Macdonald in Park Street, Mayfair. It seems not. Brooks Macdonald outsourced back-office functions for a while to Brewin Dolphin. Again, no luck.
My third try was my bank, Cater Allen Private Bank. I wanted account records for the months of March and April 1998 and 1999. I'm one of those investors who fills the ISA quota just before deadline, I'm afraid. My bank refused to offer records going back more than six years, with apologies for disappointing me.
So what are the possibilities? First, am I poorly organised or a fantasist?
Not well organised, yes. But definitely not a fantasist. I clearly remember doing the research and then investing. More pertinently, I must have had documentation in May 2000 when I spent a day organising my finances.
Second, is the investment held in some IFA nominee account at Barings? Maybe, but Barings say they can't tell me which IFAs have nominee accounts, so I can't chase them. I must have used an IFA, and recollect a conversation where I had to insist several times that this was indeed a long-term investment and that I understood the risks, etc.
Third, have I been hacked? Has someone got my details and had a cheque sent to them? Or has someone intercepted my physical mail and somehow managed to cash a cheque?
The moral is clear: fail to track your investments at your peril. You need to have bits of paper (or at least direct email contact from the investment managers).
It's also a cautionary tale for the long-term investor. Many IFAs changed their back-office functions over the past 20 years. For investors who hold ISAs – typically long-term investments – it's easy to fall through the cracks. And moving house – I've had three addresses in 12 years – doesn't help.
The final moral is the most embarrassing. Yes, saving up for the long term is essential, as I used to state in these pages on a regular basis. But when it comes to administration, readers should do as I say, not do as I do.
Meanwhile, the search for the missing PEP continues…
Martin Baker still believes in long-term saving. He is co-author of a book on the subject with his (much better organised) wife, the fund manager and entrepreneur Nicola Horlick. "Bees and Honey – You and Your Money" is published by Endeavour Press.
- 1 Husband creates spreadsheet detailing wife's 'excuses' for turning down sex
- 2 Saneie Masilela, 9, marries Helen Shabangu, 53 years his senior, for the second time
- 3 UK pirates will get four warning letters a year
- 4 Why I'm on the brink of burning my Israeli passport
- 5 Is Gideon Levy the most hated man in Israel or just the most heroic?
Malaysia Airlines flight MH17 crash: 'Nine Britons, 23 Americans and 80 children' feared dead after Boeing passenger jet is 'shot down' near Ukraine-Russia border
Malaysia Airlines MH17 crash: Vladimir Putin is given 'one last chance' to end hostilities in Ukraine
The truth about conspiracy theories is that some require considering
The 'scroungers’ fight back: The welfare claimants battling to alter stereotypes
Malaysia Airlines MH17 crash: Ukrainian military jet was flying close to passenger plane before it was shot down, says Russian officer
Malaysia Airlines MH17 crash: victims’ bodies bundled in black bags and loaded onto trains
iJobs Money & Business
£28000 - £32000 per annum + benefits: Ashdown Group: Training Programme Manage...
£28000 - £32000 per annum: Ashdown Group: Training/Learning and Development Co...
£60000 - £75000 per annum + BONUS + BENEFITS: Harrington Starr: Business Anal...
£70000 - £90000 per annum + Job Satisfaction: Harrington Starr: Project Manage...
Day In a Page
Surrounded by glorious countryside in the village of Udimore, sits this impressive four-kiln oast and barn conversion
A five-bedroom house in the picturesque village of Kettlewell, north Yorkshire
An 18th-century former coaching inn with original staircase, open fireplaces and beams throughout
A Grade II-listed Georgian town house with three bedrooms and a south-facing courtyard, near Arundel Castle
Feel on top of the world at this über chic penthouse on the 37th floor of one of Europe’s tallest blocks.
A Grade II-listed Victorian villa with six bedrooms and two further cottages, all with spectacular sea views
A grade II-listed, Georgian cottage with mature 50ft garden, perfect for summer entertaining
A magnificent Georgian pile with turrets, seven bedrooms, a heated pool and four acres of gardens
Fairoak Farm has five bedroom suites, gym, outdoor swimming pool and golf course
Chic two-bedroom river-fronted flat with a private lift that delivers you directly to your home
A spectacular seven-bedroom Tudor pile, once owned by Henry VIII, with 18 acres of land
A seven-bedroom Georgian property previously used as a picturesque wedding venue
A split-level flat in a church conversion with two en suite bedrooms and 1,200sq ft of living space
A three-bedroom bungalow situated behind an impressive stone wall, £645,000
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads
Chapel House is a former vicarage with nine bedrooms in the beautiful Upper Wye Valley
A five-bedroom B&B and separate owner's accomodation with potential for conversion
Enjoy summer by the Thames in this two double-bedroom converted warehouse in Rotherhithe village
A one-bedroom, luxury apartment with private gym and concierge service in Moorgate
A four-bedroom house in Hermitage Gardens with three reception rooms and landscaped gardens
A seven-bedroom Grade II-listed property with a separate self-contained apartment
A five-bedroom Victorian house with three reception rooms and galleried landing, £695,000
A six-bedroom farmhouse with five acres of land in a former cloth-making village
A secluded seven-bedroom detached house with large private garden, £490,000
A three-bedroom cottage overlooking Sarratt village green with open fires and solid oak floors
A three-bedroom maisonette flat in a Grade I-listed, Georgian townhouse in a sought-after location
A one-bedroom apartment located within a private gated development, north of Turnham Green
Look forward to a brighter future at two-bedroom Sunny Cottages, ideal for Londoners looking to downsize
A three-bedroom red-brick cottage with outbuildings and pretty gardens, £200,000
This three-bedroom flat within a former textile factory spans the corner of the fourth floor and has a balcony
A charming four-bedroom Oxfordshire cottage with oak floors and chunky-beamed ceilings, £465,000
A beautiful one-bed flat in a sought-after portered block, with access to Norland Square communal gardens
A one-bedroom flat within a Sixties school conversion with high-spec design and open-plan kitchen, close to Lambeth North Tube, £435,000
A 17th century four-bedroom house, with open fireplaces, cellar and pool, £600,000
A three-bedroom, coach house with luxury open-plan living space and contemporary breakfast bar