e-mail Paul Lewis on paul@paullewis.co.uk
Flood Relief
A new agreement between
the insurance industry and the Government should go a long way to ensure half a
million homeowners living in areas which have been flooded before or are deemed
‘at risk’ of flooding will be able to insure their home at an affordable cost.
These high risk homes will be insured by a new-not for-profit firm called Flood Re which will be owned by the insurance industry and funded by a £10.50 levy taken from every home insurance policy. The industry says that will not put up premiums.
Under the scheme insurance against flood for those high risk homes will be priced by council tax band – from £210 in Band A to £540 in Band G. These illustrative amounts are just for flood insurance – other insurance costs will have to be met on top and will add between £440 and £1010. Band H homes, the most expensive, will be excluded from the deal and will have to pay for insurance at market rates. A few homes that flood frequently will also be excluded and remain uninsurable. The figures relate to England – exactly how it will work in the rest of the UK has still to be announced.
The new deal will begin in 2015. Until then the existing ‘Statement of Principles’ will continue. It ensures all homes can get insurance. But the cost is often high and householders are normally confined to their existing insurer.
Arch cru action
Up to 20,000 people who lost most of their money after investing in a
scheme called ‘Arch cru’ may get more compensation after lawyers announced that
legal action was being started against the UK firm Capita Financial Managers
(CFM). The Arch cru scheme was highly complex with money invested through what
were called ‘cells’ in Guernsey. That enabled high risk investments such as
shipping, hedge funds, and wine to be marketed as low risk to UK investors, many
of whom put their life savings or pension money into them. Altogether Arch cru
took in £470 million and the job of CFM was to ensure the complex structure
still complied with UK regulatory requirements. Arch cru was suspended in 2009
and on November 26, 2012 the Financial Services Authority found CFM had failed
Arch cru customers. It would have fined CFM £4 million but replaced the fine
with a Public Censure after CFM claimed it would collapse if forced to pay. CFM
contributed £32m towards a £54m compensation scheme. Investors who were mis-sold
can also seek compensation from their financial adviser. But the limits on what
can be awarded are less than many people have lost. Most investors will be lucky
to get much more than half their investment under the compensation schemes
currently in place. Four years on, some have had nothing at all.
So City lawyers Harcus Sinclair is preparing a case to take action against Capita Financial Managers along the lines of the 27 page judgement by the FSA in its public censure of the firm for, among other things, failing to monitor the investments or treat customers fairly. Arch cru investors can join in with the claim at www.archcruclaims.org. CFM told me its contribution to the £54 million payment scheme “provides a fair and reasonable outcome for investors”.
30,000 could claim
payment compensation
If you have told your bank or credit card company to
stop a payment and it has not done so then you could be due compensation. As
Saga has reported before, your bank or card provider has to obey your
instruction to stop payments to a firm. If it subsequently makes a payment, then
it must refund it. The law, which began in November 2009, has been widely
ignored by banks. So the new regulator, the Financial Conduct Authority, has
made it clear that the law must be obeyed. It estimates that 30,000 people could
be due compensation where a bank or card provider failed to do so.
These recurring payments or continuous payment authorities
can easily be taken out without realising when ordering goods or taking out a
loan online. You give the authority so you can stop it at your bank. It is
courteous to inform the firm that is helping itself to your money. But there is
no obligation to do so. If you have been let down by your bank or card provider
write a letter of complaint. If that does not work within eight weeks complain
to the Financial Ombudsman Service. More -
fca.org.uk/news/continuous-payment-authorities-your-right-to-cancel
SCAMWATCH: Diamonds
not forever
It was only because Elizabeth called on her 88-year-old
father on the right day that she found the vulnerable widower who has memory
problems had agreed to spend his life savings of more than £16,000 to buy
diamonds which would be kept in safe storage in Switzerland at a cost of £200 a
year and which he could never see unless he travelled there and paid security
guards and insurance while he was given access.
The firm was not registered on the Financial Conduct Authority website so Liz called the firm which, after some unpleasantness, agreed to cancel the agreement her father had received.
I got Liz’s email just before I read the comforting figures from the Office for National Statistics that crime was down, again, and we were now less likely to be a victim than at any time since 1981. But then I looked a bit closer and saw that fraud reported by the police was in fact up by 27% with 229,018 recorded cases in 2012/13. So although robbery, burglary, and car crimes have fallen, crooks seem to be turning their attention to fraud which is harder to trace and far less likely to be punished.
Never invest in anything you do not understand and have not researched. Never invest money if you cannot afford to lose it. If you have any doubts about a financial firm check it on the FCA website. If it is not authorised it should not be relied on. Or call the FCA Consumer Helpline 0800 111 6768 or email consumer.queries@fca.org.uk
e-mail Paul Lewis on paul@paullewis.co.uk