COMMENT
Three Terrible Mis-selling Cases!

Very early in my working life, I was almost bamboozled by a financial saleswoman.

After a long, persuasive and slick meeting, she convinced me to buy one of her company's combined investment and protection products. However, when the documentation arrived later that week, I read it carefully to try to remember exactly why I'd bought this product.

I discovered that, thanks to its fantastically high charges and premiums for life cover that I didn't need, the plan that she'd sold me wouldn't be worth anything for many years, making it a poor long-term savings product. With a clear head, I signed and returned my "right to cancel" notice. Later that week, I endured an angry telephone call from the salewoman, who was pretty miffed that her fat commission had flown out of the window!

These days, after spending my entire career working in financial services, I often volunteer to help people with similar problems. Here are three people whom I've helped in recent years (names have been changed to protect the innocent!):

1. "Mrs A" - the wrong pension

In the early Nineties, Mrs A, a teacher in her fifties, was visited by a financial adviser who worked for Lloyds TSB. Instead of explaining that she could boost her pension income by paying more into the teachers' pension scheme, this crafty salesman instead sold Mrs A a high-charging additional voluntary contribution (AVC) plan.

Unsurprisingly, this AVC performed very badly, so Mrs A's daughter came to me for help. We drafted a formal mis-selling complaint, explaining that Mrs A had not been given "best advice" and, what's more, the salesman had forged a letter to her employer to "justify" his advice! Lloyds TSB wriggled and squirmed for some time before coughing up a few thousands pounds in compensation.

2. "Mr & Mrs B" - the wrong mortgage

Mr & Mrs B bought their council house under the "right to buy" legislation, with the help of a mortgage from the Halifax and an endowment policy from Guardian. However, their financial adviser failed to warn them that their 25-year mortgage would not be paid off until they were in their late seventies.

When I spoke to Mrs & Mrs B, they were retired and were struggling to meet their mortgage repayments. I helped this couple to complain to the Financial Ombudsman Service, which agreed that they had been badly advised and ordered the companies involved to pay them considerable damages.

3. "Mr C" - the wrong life insurance

Last year, Mr C asked me why he'd received a "red letter" from Windsor Life, which warned that his policy wasn't on track to pay off his mortgage. There were two problems with this information. Firstly, Mr C has never had a mortgage and, secondly, he was sure that he'd bought life insurance to protect his family, not an investment plan!

After reading his documentation, I explained to Mr C that the "term assurance" that he'd asked for ten years previously was, in fact, a mortgage endowment. Because his accomodation is provided by his employer, Mr C has never bought a house and has no plans to do so. Hence, he was very angry that he'd been duped by a silver-tongued salesman! I helped Mr C to draft a formal letter of complaint to Windsor Life, and I expect that he'll receive a five-figure sum in compensation.

One thing that these three cases have in common is that all three salesmen were "tied agents". In other words, they worked for a particular company and could recommend only that company's products. Given their lack of independence - and the fact that their personal earnings are linked to steep sales targets - I worry about the advice that tied agents give. In fact, I wouldn't recommend taking the advice of a tied agent under any circumstances. And that includes salespeople working for the high-street banks, who are among the worst offenders!

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