Bigger home income plans payout sought

Thousands of elderly people who lost money through the collapse of home income plans could receive more compensation if a court case due to be heard on Tuesday goes in their favour, writes Maria Scott.

Investors lost money through the drop in the value of investment bonds sold to repay mortgages and provide an income.

Barnett Sampson, a firm of solicitors representing 700 victims, will argue in the High Court in London that its clients have been short-changed by the Investors Compensation Scheme.

The ICS, set up under the Financial Services Act, has dealt with compensation claims from people who bought plans from independent advisers. Those who bought similar plans from agents representing insurance companies have in many cases been compensated by the insurers.

Barnett Sampson argues that these settlements have been fairer, on the whole, than those meted out by the ICS.

The firm has a list of grievances against the ICS, including its refusal to compensate for illness and distress resulting from the disastrous income plan investments.

A spokeswoman for the ICS said the organisation would be vigorously defending Barnett Sampson's case.