Questions Of Cash: 'Did my mother's investment perform as it should have?'

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The Independent Online

Q. In 2006, my late mother invested £85,000 in a Halifax Bank of Scotland (HBOS) Guaranteed Investment Plan, placed in a trust with my sister and me as beneficiaries. The key facts state the aim of the plan as growth, with a guarantee after five years to return at least the value of the original investment. It has achieved no growth. In January, we were told the fund is now entirely invested in fixed-interest assets. We chose to close the trust and distribute the funds to the beneficiaries, taking advantage of a tax-efficient option. The closing fund value was £85,117.80. Should we regard the fund as having achieved the objective of protecting the investment; that it performed poorly, but that it is a case of buyer beware; or that the product was badly conceived and misrepresented? NK, Surrey.

A. HBOS is now part of the Lloyds Banking Group, which argues strongly that the policy was not mis-sold and that the objective of taking out the policy was not only growth, but also to avoid inheritance tax (IHT) liability. Had the policy been held for seven years, some £85,000 would have been removed from IHT liability in your mother's estate. But the fact that there is a guarantee in place created an extra cost in management charges. Lloyds accepts that your parents were promised in November 2006 that the funds would be invested in March 2007, whereas the investments were actually made in December 2006. As a result, the funds were subject to a stronger fall in equity values. Had the investment been made at the time promised, the surrender value would have been £1,616.20 more than you and your sister were paid. Lloyds has now offered to pay you this amount. You can, though, pursue the matter with the Financial Ombudsman if you believe you have a case to argue that the policy was mis-sold.

Q. Carphone Ware-house (CPW) closed its Fresh Mobile network and told us it would port our two phone numbers to its Talkmobile network on 19 March. Our numbers should have moved in a seamless switch. But we were instead given numbers belonging to other people. We lost our calls and received calls for other people. As a result, I have had to switch off our mobile banking service and make alternative arrangements to prevent people from seeing our details. We expect to be compensated, but we do not know the actual losses caused by people not being able to contact us for five days. DL, Leamington Spa.

A. Carphone Ware-house accepts it ported your Fresh number to its other service incorrectly. CPW will pay you compensation of £120, representing £60 per line. It will also give you a new handset free of charge to replace one of your mobiles that is not working properly.

Q. BT is attempting to get me to pay a bill it raised in error. The amount on the bill varies from time to time, but in a letter dated 13 March the amount is set at £181.83, and a debt-collecting agency, Credit Solutions Ltd, in a letter dated 16 March, demands £227.29, including its fee. BT told me on 9 September 2009 that it had written off the debt. I moved to my current address on 31 May 2007, ordering a BT landline service before I moved. The line was connected only in the late summer. I later ordered and received a BT broadband service. I pay my BT bills regularly. I had complained to the CEO's office in spring 2007 about the failure of BT to provide a phone line and BT explained that it had processed four separate orders for me. The operative cancelled three of the orders and the bill I am being chased for appears to be the cancellation fee for those three orders. I have repeatedly been promised that this was resolved. SM, Northumberland.

A. BT has agreed to write off the debt, cancelled the debt-collection instruction to Credit Solutions Ltd and has credited your account with £50 as a goodwill gesture in recognition of its poor service to you.

Q. I have yet to hear back from easyJet about a refund claim for a flight cancellation that I submitted on 6 January. My flight from Munich to Manchester on 20 December was cancelled, as was the "replacement" flight to Gatwick the following day. We managed, with difficulty, to get back to Manchester on 22 December via a flight to Edinburgh, staying overnight. EasyJet did its best to provide a decent hotel and transfer in Munich, but we have not even had an acknowledgement that it received our claim. KH, Manchester.

A. EasyJet apologises and accepts your claim should have been dealt with earlier. It says the delay was caused by "an oversight". It has now agreed to offer you a refund of £338.70, comprising £231.20 for your additional flight purchases, £50 for hotel accommodation, £40 for food and £17.50 for taxis.

Questions of Cash cannot give individual advice. But if you have a financial dilemma, we'll do our best to help. Please email us at: questionsofcash@ independent.co.uk

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