Q. We gave my son £230 in Thomas Cook vouchers last autumn, which we bought for his birthday. Just after Christmas, he tried to purchase online two nights in London, but the vouchers were not accepted. This is despite the reverse of the vouchers clearly stating that they can be redeemed online.
My son telephoned Thomas Cook and was told he had to take them to one of their branches as the vouchers could not be used online. He took them to the company's Winchester branch, but the offers available online were not available in the shop. Later, he went back to try to purchase Eurostar tickets with the vouchers, but was told that he could not purchase these tickets without a holiday as well. We feel that the vouchers were mis-sold to us. SM, Dorset.
A. Your son appears to have been given wrong information when he phoned Thomas Cook. The vouchers can be used for online bookings – though even the company admits the process for using them is not straightforward. Detailed information on how to redeem the vouchers online is published on the Thomas Cook website. A company spokeswoman said: "We are in contact with [the reader's son] and are helping him to make his booking using his Thomas Cook travel vouchers." She added that Eurostar does not permit any retailers to sell its tickets: this restriction is not imposed by Thomas Cook.
Q. In the summer of 2006, my sister and I asked Barclays' financial advisers to find the best investment for the money from the sale of our parents' house to pay for their residential care. By then they were both in care homes. The proceeds of the house sale came to £387,000, to be divided equally between them as tenants-in-common. My father needed greater, and therefore more expensive, care. My mother's care home fees were £37,000 a year and our father's approximately £65,000 a year. The two Barclays advisers spent some hours with us at my sister's house and were fully informed of all the circumstances and our requirements.
We needed to make the money go as far as possible, but to have access for the monthly fees for both parents. The advice was to put £80,000 of our mother's funds into bonds, one with Prudential, the other with Axa. The rest was supposed to cover her fees until the bonds matured. In fact, this left us short of easily accessible cash and we had to withdraw a total of £32,500 from the two bonds, thereby incurring penalties – exactly what we had wanted to avoid. For our father, who was already 98 at the time of the advice, the advisors had no suggestions, so we put all his half of the money into an instant-access account at Birmingham Midshires. I realise now that they could, at the very least, have suggested putting a portion of it into a 12 or 18-month higher-rate deposit.
My father died on 1 January 2010, aged 101, by which time we had got down to £22,000 and social services had to step in to help with his fees. My mother died on 1 January 2011. It was only then I felt able to make a formal complaint to Barclays, which I did in August. I received a reply in October, in which Barclays upheld my complaint and agreed that the bonds had been inappropriate. But Barclays also claimed that despite the penalties, we were still better off and had made a gain. They offered compensation of £239, despite us paying penalties of £691. Surely a better recompense is due? Barclays also says it has no record of any advice being given regarding my father's funds. JS, London.
A. The advice was provided by Barclays Wealth, which has provided us with a comprehensive explanation of how it calculated the compensation it believes is due. The investigation concluded that the advice to invest in the Prudential and Axa bonds "was not appropriate". "We did not consider that an investment of £80,000 into products with a minimum recommended term of five years was appropriate," concluded the investigation. They also accept that the administrative arrangements caused by the foreseeable need to cash the bonds in early were likely to cause distress.
However, despite what is acknowledged to be the inappropriateness of the advice, it did yield a financial gain if the alternative is assumed to have been to place the funds in a short-term deposit account earning interest rate at the then Bank of England base rate. Some £1,907.22 was gained by putting the money in the Prudential bond, rather than on short-term deposits. The situation was different regarding the Axa bond, where the early withdrawal led to a loss compared to putting the money on deposit. That loss was £239.51, which is the amount of compensation Barclays Wealth believes it owes you, plus 8 per cent interest that could have subsequently been accumulated of £4.36. Barclays Wealth says that while you and your sister understood the risks attached to the investments, you did not realise that you would have to pay penalties for early access to the funds.
Given that no advice was actually given regarding your father's finances, Barclays Wealth does "not feel it appropriate to pay compensation" for any loss caused by putting the money in a lower-interest account. A spokesman for Barclays Wealth says: "We are sorry for the poor experience that [the reader] has had in relation to the sale of the two bonds to her mother and subsequent interaction with the bank. We have upheld the complaint in full, and offered [the reader] redress that puts her in a better position than she would have been in had the original advice not been given and the monies remained on deposit, making our calculation at least in line with what the Financial Ombudsman Service awards when it is established that the complainant should not have taken any risk."
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: questionsofcashindependent.co.uk.
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