0:00:02 > 0:00:06We asked you to tell us, "Who's left you feeling ripped off?"
0:00:06 > 0:00:09I think this is very, very wrong for what they have done.
0:00:09 > 0:00:13The bank piles charges upon charges upon charges.
0:00:13 > 0:00:18Legally, it was right. Morally? That's where the question and doubt comes, in my view.
0:00:18 > 0:00:21And you contacted us in your thousands,
0:00:21 > 0:00:25by post, email, even stopping us in the streets!
0:00:25 > 0:00:28The message could not be clearer.
0:00:28 > 0:00:31You don't always get a straight answer. They fob you off.
0:00:31 > 0:00:36- I'm not happy with them at all. - There's always that small print that you didn't realise.
0:00:36 > 0:00:38We're being ripped off big time.
0:00:38 > 0:00:40Whether it's a deliberate rip off,
0:00:40 > 0:00:43a simple mistake or a catch in the small print,
0:00:43 > 0:00:46we'll find out why you're out of pocket
0:00:46 > 0:00:48and what you can do about it.
0:00:48 > 0:00:51Keep asking the questions. Go to the top if you have to.
0:00:51 > 0:00:53We do get results.
0:00:53 > 0:00:59Your stories, your money... This is Rip-Off Britain.
0:01:01 > 0:01:03Hello and welcome to Rip-Off Britain,
0:01:03 > 0:01:09the series that investigates why you've lost out financially or been left feeling short-changed.
0:01:09 > 0:01:14We're here to stop you ending up in situations that cost a lot more than you bargain for.
0:01:14 > 0:01:18That's what happened to the people we're going to be hearing from today,
0:01:18 > 0:01:21people who'd done the sensible thing by investing their money,
0:01:21 > 0:01:24hoping that it would grow for the rest of their lives,
0:01:24 > 0:01:28but didn't get the returns that they'd hoped for.
0:01:28 > 0:01:31In fact, worse than that, they suffered enormous losses,
0:01:31 > 0:01:34sometimes to the tune of tens of thousands of pounds.
0:01:34 > 0:01:39As we'll see, a bad investment can have a devastating effect on you and your future.
0:01:40 > 0:01:42Also coming up,
0:01:42 > 0:01:47when the risks of an investment turn out to be far greater than ever imagined...
0:01:47 > 0:01:53We could end up losing this house and everything that we own.
0:01:53 > 0:01:57And more stories from our one-stop Rip-Off Britain advice shop.
0:01:57 > 0:02:00What she'd been paying in
0:02:00 > 0:02:04was twice as much as the benefit that's going to be paid out.
0:02:04 > 0:02:07Now to a battle for compensation
0:02:07 > 0:02:10that involves quite a number of Rip-Off Britain viewers
0:02:10 > 0:02:15who had bought saving investments backed by the American bank Lehman Brothers.
0:02:15 > 0:02:20You may recall that the bank dramatically collapsed in September of 2008,
0:02:20 > 0:02:22causing shockwaves around the world.
0:02:22 > 0:02:28Thousands of UK savers were affected. Many had invested everything that they had.
0:02:28 > 0:02:32Three years on, some of them have managed to get some money back
0:02:32 > 0:02:34through an industry compensation scheme,
0:02:34 > 0:02:38but there are plenty more who have had their claims turned down
0:02:38 > 0:02:42and who now fear that they will never see a penny of their savings again.
0:02:43 > 0:02:46These beautiful 40 acres of rural Wales
0:02:46 > 0:02:50are home to Belinda Platt and her husband, Martin.
0:02:50 > 0:02:52Would you like a cup of tea?
0:02:52 > 0:02:54They've lived here since 1970,
0:02:54 > 0:02:57and over the years, the land has given them a decent living
0:02:57 > 0:03:02as a garden centre, farmland, B&B and even a caravan park.
0:03:02 > 0:03:06But Martin developed vascular dementia and arthritis
0:03:06 > 0:03:09and Belinda has gradually become his carer.
0:03:09 > 0:03:13I do everything for Martin,
0:03:13 > 0:03:16apart from washing.
0:03:16 > 0:03:20He can manage to do that and he can shave himself.
0:03:20 > 0:03:23It is a learning curve.
0:03:23 > 0:03:25You find that...
0:03:25 > 0:03:30..every day there's perhaps something new
0:03:30 > 0:03:32and you learn to cope with it.
0:03:32 > 0:03:36Unable to work the land in the way that they had in the past,
0:03:36 > 0:03:41the couple found that they needed an income to supplement their small pension and other investments.
0:03:41 > 0:03:46So in 2003, they released some equity from their house
0:03:46 > 0:03:51in order to take out a fixed-income plan with the investment provider NDFA.
0:03:51 > 0:03:54We wanted an investment which had...
0:03:54 > 0:03:57..an acceptable amount of risk.
0:03:57 > 0:04:00This plan,
0:04:00 > 0:04:07it was based on the fact that our capital was secure
0:04:07 > 0:04:12unless the indices plunged below 50 percent.
0:04:12 > 0:04:15We thought that was an acceptable risk.
0:04:15 > 0:04:20Belinda took advice from an independent financial advisor
0:04:20 > 0:04:23and, happy that the risk wasn't too high,
0:04:23 > 0:04:26she invested £30,000 in the plan,
0:04:26 > 0:04:32which seemed a good decision as it started paying out the income that they needed every month.
0:04:32 > 0:04:37We had money coming in to meet the utility bills,
0:04:37 > 0:04:39council tax,
0:04:39 > 0:04:44insurances, which are a big thing, house and car,
0:04:44 > 0:04:50and we wanted the money to be there at the time that the bills came in.
0:04:50 > 0:04:54When the policy came up for renewal five years later in 2008,
0:04:54 > 0:04:57Belinda says they received a letter from NDFA
0:04:57 > 0:05:01to say that they could carry their existing policy over.
0:05:01 > 0:05:05Again, they were told that the investment would only be at risk
0:05:05 > 0:05:09if the stock markets dropped by a significant amount.
0:05:09 > 0:05:13It had served us well for the previous five years.
0:05:13 > 0:05:14It was convenient.
0:05:14 > 0:05:19The way it was sold in the renewal letter,
0:05:19 > 0:05:24it repeated its pledge that our money was only at risk
0:05:24 > 0:05:29if the indices fell
0:05:29 > 0:05:34and we thought we were buying the plan
0:05:34 > 0:05:37on the same basis as the previous one,
0:05:37 > 0:05:39so we went ahead.
0:05:39 > 0:05:42Just after they reinvested in the plan,
0:05:42 > 0:05:46news broke that Lehman Brothers, the big American investment bank,
0:05:46 > 0:05:48had gone bust.
0:05:48 > 0:05:51"After Meltdown Monday at Lehman Brothers in Canary Wharf,
0:05:51 > 0:05:55"most of the firm's 5,000 employees are expected to lose their jobs."
0:05:55 > 0:06:01Belinda discovered, to her horror, that Lehman's was the backer of her investment plan.
0:06:01 > 0:06:06So her £30,000 capital had gone down with the bank.
0:06:06 > 0:06:11It was rather like somebody dying. You have disbelief and then...
0:06:11 > 0:06:17..and then grief and that sort of thing and anger.
0:06:17 > 0:06:22You know, "How can somebody get away with this?"
0:06:22 > 0:06:27It took a bit of time to gel really that we had lost it.
0:06:27 > 0:06:30We thought, "Somebody must be going to do something."
0:06:30 > 0:06:33The Financial Services Compensation Scheme
0:06:33 > 0:06:39has paid out to some of the people who lost money in investment plans backed by Lehman Brothers.
0:06:39 > 0:06:42There were a total of 15 products sold in the UK
0:06:42 > 0:06:45and ten have been compensated automatically.
0:06:45 > 0:06:50But Belinda and Martin's is one of the five that were rejected.
0:06:50 > 0:06:55The compensation scheme said that the investors in these five plans
0:06:55 > 0:06:58had been properly informed of the risks.
0:06:58 > 0:07:00Belinda disagrees.
0:07:00 > 0:07:04Nobody knew that Lehman's was the backer.
0:07:04 > 0:07:08Everybody thought that there was...
0:07:08 > 0:07:11..a spread of investments
0:07:11 > 0:07:16quoted on the stock exchange or the Dow Jones.
0:07:17 > 0:07:23Though she knew the plan she invested in wasn't supposed to be covered by the compensation scheme,
0:07:23 > 0:07:26Belinda applied to it anyway.
0:07:26 > 0:07:28Her claim was rejected.
0:07:28 > 0:07:33But, determined not to give up, Belinda has appealed that decision.
0:07:33 > 0:07:36I do feel very strongly about it
0:07:36 > 0:07:39and I feel that NDFA
0:07:39 > 0:07:44and the Financial Services Compensation Scheme
0:07:44 > 0:07:48have treated us,
0:07:48 > 0:07:52or they've treated these victims, badly.
0:07:52 > 0:07:54After three years of desperately wondering
0:07:54 > 0:07:58if they'll get any of their £30,000 back,
0:07:58 > 0:08:02Martin's health, their savings and the house and land they love
0:08:02 > 0:08:05are all deteriorating.
0:08:05 > 0:08:08I just want to keep what I've got
0:08:08 > 0:08:12and keep it in good order
0:08:12 > 0:08:17so that if we ever do have to sell it,
0:08:17 > 0:08:20it'll be a good saleable commodity
0:08:20 > 0:08:23and we have something to leave our children.
0:08:24 > 0:08:28As we've seen, Belinda's claim was originally turned down
0:08:28 > 0:08:31by the Financial Services Compensation Scheme.
0:08:31 > 0:08:33But she did appeal the decision
0:08:33 > 0:08:37and we're delighted to say that she has now just received a cheque
0:08:37 > 0:08:40for the full amount of £18,000.
0:08:40 > 0:08:45So Belinda is now going to put in a claim for her husband's investment of £12,000.
0:08:45 > 0:08:48Obviously, she's hoping they'll get the same result.
0:08:48 > 0:08:51So a success for Belinda
0:08:51 > 0:08:55and one that shows that it really is often worth pursuing a claim.
0:08:58 > 0:09:00Now, if you've ever fallen for a slick sales pitch
0:09:00 > 0:09:03or been subjected to a hard sell,
0:09:03 > 0:09:06you'll have real sympathy for our next case study.
0:09:08 > 0:09:10She may not be as mobile as she used to be,
0:09:10 > 0:09:15but 88-year-old May Bell is absolutely determined to lead an active life.
0:09:15 > 0:09:20Two years ago, she was cold-called by a salesman from a mobility aids company.
0:09:20 > 0:09:23Because she was already considering buying a new stairlift,
0:09:23 > 0:09:28she agreed to let him come round, as her granddaughter, Francis, explains...
0:09:28 > 0:09:32My grandma initially agreed for him to come because she wanted a new chair.
0:09:32 > 0:09:36She wanted a stairlift. That was all she wanted.
0:09:36 > 0:09:41As soon as he walked in that door, he was intent on selling her that scooter.
0:09:41 > 0:09:43"Let me show you what different ones we do.
0:09:43 > 0:09:48"We'll give you this discount, we'll put these freebies on..."
0:09:48 > 0:09:53She thought she was getting a bargain! "Ooh, yes, it looks great, this!"
0:09:53 > 0:09:57The salesman's name was Shane Johnson, from Nottingham Mobility.
0:09:57 > 0:10:00His sales pitch went on and on.
0:10:00 > 0:10:03After an hour and a half, May caved in.
0:10:03 > 0:10:06As well as a stairlift and a reclining chair,
0:10:06 > 0:10:09she was also talked into buying the scooter.
0:10:09 > 0:10:12Add to that £100 for removing the old stairlift,
0:10:12 > 0:10:17the total bill came to a whopping £4,185.
0:10:18 > 0:10:21I feel that she were pressurised into it
0:10:21 > 0:10:25and I think that it was something that she didn't need to buy.
0:10:25 > 0:10:29It was money that she didn't need to spend on it
0:10:29 > 0:10:33but she felt pushed that way because...
0:10:33 > 0:10:37..I think by the time they'd left, she was exhausted.
0:10:37 > 0:10:41May is pleased with the chair that Nottingham Mobility supplied,
0:10:41 > 0:10:43but quickly realised that for her,
0:10:43 > 0:10:46the scooter had been a total waste of money.
0:10:46 > 0:10:49I don't feel safe with it.
0:10:49 > 0:10:53I mean, I've never gone out on the road,
0:10:53 > 0:10:56I've never walked across the road on my own,
0:10:56 > 0:11:00but he said, "Oh, you'll get used to it."
0:11:00 > 0:11:02But no.
0:11:02 > 0:11:04But May's problems were only just beginning.
0:11:04 > 0:11:09Johnson told her that the new stairlift would arrive in two weeks.
0:11:09 > 0:11:14A month later, and despite countless phone calls, there was no sign of it whatsoever.
0:11:14 > 0:11:18I had a day off waiting for them coming. Nobody arrived.
0:11:18 > 0:11:23Rang them up. "Oh, he's out. He could be here on Monday."
0:11:23 > 0:11:26I'd book another day off, wait in again and it didn't come.
0:11:26 > 0:11:29It was a continual cycle.
0:11:29 > 0:11:33Nottingham Mobility had already disconnected May's old stairlift.
0:11:33 > 0:11:38As she's got severe arthritis, she was trapped downstairs for five weeks,
0:11:38 > 0:11:39having to sleep in a chair
0:11:39 > 0:11:42and using a commode instead of the toilet.
0:11:42 > 0:11:46When I tried to get upstairs, I was frightened of falling.
0:11:46 > 0:11:50It was awful for her. She's quite an independent person.
0:11:50 > 0:11:53She was having to rely on me and I was working,
0:11:53 > 0:11:57so when I wasn't here, it was terrible for her.
0:11:57 > 0:12:01Francis decided to contact the manufacturers direct
0:12:01 > 0:12:06and, to her horror, was told that they'd never even received an order from Nottingham Mobility.
0:12:06 > 0:12:09They were so appalled by her gran's story,
0:12:09 > 0:12:13they fitted a new stairlift absolutely free of charge.
0:12:13 > 0:12:16It puts elderly and vulnerable people
0:12:16 > 0:12:20off of buying this equipment that they need.
0:12:20 > 0:12:23But there are reputable companies out there,
0:12:23 > 0:12:25it's just a matter of finding the good ones.
0:12:25 > 0:12:29These definitely were not the good ones.
0:12:29 > 0:12:34Nottingham Mobility was run by father-and-son team Shane and Laurence Johnson.
0:12:34 > 0:12:40After an investigation, the local Trading Standards found that they'd made up to £31,000,
0:12:40 > 0:12:43charging for products that simply never arrived.
0:12:43 > 0:12:48As a result, in July they were convicted of breaching Consumer Protection Regulations
0:12:48 > 0:12:51and sentenced to a year in prison.
0:12:51 > 0:12:52Although they're no longer trading,
0:12:52 > 0:12:58Trading Standards says that there are thousands of firms cashing in on mobility gear,
0:12:58 > 0:13:02a market worth £200 million a year just in the UK.
0:13:02 > 0:13:07A casual glance into driveways on a typical street like this,
0:13:07 > 0:13:11they may notice there's a scooter parked in the drive,
0:13:11 > 0:13:15there might be railings, which are an assist for the person into the house.
0:13:15 > 0:13:18And once a salesman has identified a house,
0:13:18 > 0:13:23he just needs to come up with a convincing reason to be calling unannounced.
0:13:23 > 0:13:25A lot of underhand tactics...
0:13:25 > 0:13:29Being told that they've been called because of some health problem
0:13:29 > 0:13:33that's been reported by the local authority or indeed their doctor,
0:13:33 > 0:13:38to get the confidence of the person and to get that salesman into the home in the first place.
0:13:38 > 0:13:43Some parts of the country now have Cold Calling Exclusion Zones.
0:13:43 > 0:13:46But in those that don't, the best advice
0:13:46 > 0:13:49is to beware of any company that calls out of the blue,
0:13:49 > 0:13:53trying to flog you expensive things that you may not need.
0:13:54 > 0:13:55Still to come on Rip-Off Britain,
0:13:55 > 0:14:01a desperate battle to reclaim money after a disastrous investment.
0:14:01 > 0:14:06I was devastated at the thought of losing £50,000.
0:14:06 > 0:14:11And we hear more of your stories from the drop-in Rip-Off Britain shop in Manchester.
0:14:13 > 0:14:17Now, with pension funds drying up and no longer a guarantee of income,
0:14:17 > 0:14:21it's obvious why so many of you are looking to other types of investments
0:14:21 > 0:14:25in the hope of that they'll provide regular cash once you've retired.
0:14:25 > 0:14:30Mike and Peggy Newman signed up to one that was described as "low risk",
0:14:30 > 0:14:34but it turns out they bought into what was called a Frankenstein product.
0:14:34 > 0:14:39You've never probably heard of that, but it's just as much of a monster as it sounds.
0:14:39 > 0:14:41THEY SING OPERATICALLY
0:14:42 > 0:14:45After successful careers as opera singers,
0:14:45 > 0:14:49Mike and Peggy Newman were looking forward to their retirement.
0:14:50 > 0:14:52However, like many pensioners,
0:14:52 > 0:14:56they were property rich but cash poor.
0:14:57 > 0:15:02We want to keep this house to leave to our sons.
0:15:02 > 0:15:07It's the biggest amount of money we've got, by a long way,
0:15:07 > 0:15:10and that's what is their inheritance.
0:15:11 > 0:15:14They began thinking about how they could get an income
0:15:14 > 0:15:17without taking away from their children's inheritance.
0:15:17 > 0:15:22Selling the house and downsizing was one option.
0:15:22 > 0:15:26It's either that or have a lifetime mortgage again,
0:15:26 > 0:15:32which, at our stage in life, at 73 and 76,
0:15:32 > 0:15:38we don't want to be bogged down with a huge mortgage
0:15:38 > 0:15:41that's going to eat into the...
0:15:41 > 0:15:44- The equity on the house. - The equity on the house.
0:15:44 > 0:15:47So instead, they contacted Mint,
0:15:47 > 0:15:50an authorised and respected financial services company.
0:15:50 > 0:15:55Mint suggested an elaborate product called the Maximiser,
0:15:55 > 0:15:58which they sold for a company called Integrity.
0:15:58 > 0:16:01It involved taking out a loan against their house
0:16:01 > 0:16:05and that loan would be invested in a way that would provide a monthly income,
0:16:05 > 0:16:09repay the loan and even generate a profit.
0:16:09 > 0:16:11So it all sounded ideal.
0:16:11 > 0:16:15We were told that the product at the end of the term
0:16:15 > 0:16:19would not only meet all the expenses
0:16:19 > 0:16:22that it would incur during the whole of the plan,
0:16:22 > 0:16:28but there would be a high probability of a lump sum which we could reinvest at the end.
0:16:28 > 0:16:31So we'd complete a circle.
0:16:31 > 0:16:34We would be left with no debt at the end
0:16:34 > 0:16:40and the probability of a sum of money we could reinvest and start all over again
0:16:40 > 0:16:43if we were lucky enough to live that long.
0:16:43 > 0:16:46So impressed were the Newmans with this remarkable product
0:16:46 > 0:16:51that they immediately signed up, taking out a loan for £89,000.
0:16:51 > 0:16:54They did so because they were told it was low risk,
0:16:54 > 0:16:59meaning they could be very confident that the equity in the house would be safe.
0:16:59 > 0:17:04We were convinced that taking on this Maximiser product was so good
0:17:04 > 0:17:09that other colleagues, friends, singers,
0:17:09 > 0:17:12we passed on the good news to them. We thought it was a good thing.
0:17:12 > 0:17:16We were told that it was a window of opportunity.
0:17:17 > 0:17:21Their faith in the Integrity Maximiser seemed well-placed.
0:17:21 > 0:17:24For two years, they received £700 a month from the product,
0:17:24 > 0:17:27which made all the difference to their living standards.
0:17:27 > 0:17:32We were able to do things more, with the garden, for instance.
0:17:32 > 0:17:34We didn't want it for any luxuries.
0:17:34 > 0:17:38- We don't have holidays.- We're not bothered about holidays or cruises.
0:17:38 > 0:17:42But after a while, those monthly payments stopped.
0:17:42 > 0:17:45They rang the company to find out why.
0:17:45 > 0:17:49They said, "The plan isn't performing satisfactorily
0:17:49 > 0:17:52"and so we're playing safe by stopping it."
0:17:52 > 0:17:58It was a signal that something was really, really wrong.
0:17:58 > 0:18:02The payments did briefly restart at a lower level
0:18:02 > 0:18:06but then stopped for good, leaving the Newmans with no monthly income.
0:18:08 > 0:18:10The couple's lawyer, Gareth Fatchett,
0:18:10 > 0:18:14says problems with the Maximiser, which is no longer sold,
0:18:14 > 0:18:18are down to the fact that it was such a complex product.
0:18:18 > 0:18:24They're called Frankenstein products because of how they're put together and the way they start to go wrong.
0:18:24 > 0:18:26Some of them have got multi parts to them.
0:18:26 > 0:18:29They've got loans, investments. Very complicated.
0:18:29 > 0:18:33Most people, when you ask them if they understand what they've got, they don't.
0:18:34 > 0:18:39For Mike and Peggy, the result of investing in one of these products has been devastating.
0:18:39 > 0:18:42Not only are they not getting the expected income,
0:18:42 > 0:18:45but the interest on their £89,000 loan
0:18:45 > 0:18:49means that they're now left owing an awful lot more.
0:18:49 > 0:18:52In fact, £138,000.
0:18:52 > 0:18:57We could end up losing this house and everything that we own.
0:18:58 > 0:19:02In 2009, the Financial Ombudsman Service looked into their case.
0:19:02 > 0:19:08It was found in their favour because the risks of the product had been misrepresented to the Newmans.
0:19:08 > 0:19:12It gave them hope that they would finally get some money back.
0:19:12 > 0:19:16- It was a relief and - - We didn't feel so foolish.
0:19:16 > 0:19:20- That's right. - We thought we'd been too naive.
0:19:20 > 0:19:23But it was a mis-selling case,
0:19:23 > 0:19:27so it was a relief to know that they were in the wrong
0:19:27 > 0:19:32in any advice we'd been given and what we'd signed up for.
0:19:34 > 0:19:38But two years later, the Newmans haven't been able to agree with Mint
0:19:38 > 0:19:41what level of compensation they should be entitled to.
0:19:41 > 0:19:43They've turned down the offer so far
0:19:43 > 0:19:46because they'd still be out of pocket.
0:19:47 > 0:19:53Mike and Peggy's solicitor is dealing with a number of other Mint clients in similar situations.
0:19:53 > 0:19:59He believes that between them, they've lost a total of £3.6 million.
0:20:01 > 0:20:07Mint Financial Services told us that they regret the circumstances of the Newmans' complaint,
0:20:07 > 0:20:11but point out that they were the intermediary between the couple and Integrity,
0:20:11 > 0:20:13the company now in liquidation.
0:20:13 > 0:20:17They say they weren't given adequate information about the product,
0:20:17 > 0:20:20but since then, have done all that they can to help,
0:20:20 > 0:20:24including agreeing to lift the £100,000 cap on compensation,
0:20:24 > 0:20:27usually applied by the Ombudsman.
0:20:27 > 0:20:30They're keen to resolve this as soon as possible
0:20:30 > 0:20:36and although no final settlement has been agreed, they've given the couple an interim payment.
0:20:36 > 0:20:40But sadly, Mike and Peggy feel that now they have little choice
0:20:40 > 0:20:43but to put their house on the market in order to pay their debts.
0:20:43 > 0:20:46I can actually start shaking.
0:20:46 > 0:20:49I sort of tremble.
0:20:49 > 0:20:53My stomach starts and my hands start trembling,
0:20:53 > 0:20:56and it is all to do with the stress of it.
0:20:56 > 0:21:01It's living with it all the time. You can't get it out of your mind.
0:21:02 > 0:21:06Big companies don't always make things easy to understand.
0:21:06 > 0:21:09It can be very confusing trying to work out
0:21:09 > 0:21:12why you haven't ended up with what you'd expected.
0:21:12 > 0:21:15If you feel bogged down and don't know exactly what to do,
0:21:15 > 0:21:18we've put together a booklet of tips and advice.
0:21:18 > 0:21:21You can find the link to the free guide on our website:
0:21:26 > 0:21:28Or if you want to receive a copy in the post,
0:21:28 > 0:21:34send an A5 self-addressed envelope to the address we'll give you at the end of the programme.
0:21:37 > 0:21:40We're at the Trafford Centre in Manchester,
0:21:40 > 0:21:44where we've opened our first Rip-Off Britain pop-up shop.
0:21:44 > 0:21:48We've met so many people who are here for the weekend of free consumer advice,
0:21:48 > 0:21:52and we've been airing grievances of our own, too.
0:21:52 > 0:21:56What really bugs me, and to a serious extent,
0:21:56 > 0:22:01is that whatever you've worked for, whatever you've managed to save, and my dad taught me to save,
0:22:01 > 0:22:05is the fact that you can't get any interest on your money.
0:22:05 > 0:22:08I can understand it when people say, "I'm worried about my savings.
0:22:08 > 0:22:11"I'm worried about my pension" because so am I!
0:22:11 > 0:22:16- We are consumers, too. - Thank goodness we're involved in this programme because we love it.
0:22:16 > 0:22:21- Exactly. And we've still got a queue, so maybe we ought to deal with some of those problems.- Exactly.
0:22:22 > 0:22:26Life insurance is something that many people take out
0:22:26 > 0:22:31and you expect to get the money you've invested back for your family.
0:22:31 > 0:22:36Beverly has discovered she won't receive anywhere near the amount of money her mother has invested.
0:22:36 > 0:22:41She's popped in to share her cautionary tale with James Daley.
0:22:41 > 0:22:43Talk me through the problem.
0:22:43 > 0:22:47Right, well, in 1998,
0:22:47 > 0:22:50my mum took out a couple of insurance policies
0:22:50 > 0:22:53- which were death policies only. - Right.
0:22:53 > 0:22:57And since then, she's been paying the premiums,
0:22:57 > 0:23:00she's 90 now, she's in a nursing home,
0:23:00 > 0:23:03and I realised when I added it all up
0:23:03 > 0:23:06that the cost of what she'd been paying in
0:23:06 > 0:23:11was twice as much as the benefit that's going to be paid out.
0:23:11 > 0:23:15I wrote to the insurance companies and they wouldn't do anything about it.
0:23:15 > 0:23:19I since wrote to the Ombudsman and they are supporting the insurance company.
0:23:19 > 0:23:23The way these types of policies work, they're a sort of a gamble in a way.
0:23:23 > 0:23:29If you die young, they're better value, so to speak.
0:23:29 > 0:23:31They're not value at all, though.
0:23:31 > 0:23:36They're basically not very good products, as you can see.
0:23:36 > 0:23:41And I think now, you've got to make a decision
0:23:41 > 0:23:45as to whether or not you think paying that £8 a month is worth it,
0:23:45 > 0:23:49- given that if you cancel it, you'll lose everything.- I know.
0:23:49 > 0:23:52She'd have been better off
0:23:52 > 0:23:56putting the same money away in a building society account and she'd have that money now.
0:23:56 > 0:23:59I think it's worth getting that message across.
0:23:59 > 0:24:02Generally, these policies are not good value.
0:24:02 > 0:24:05- I'm sorry that there's no magic wand in this case.- I know.
0:24:05 > 0:24:08- All the best.- BOTH: Thank you.
0:24:09 > 0:24:14Making the most of your money in these tricky financial times can be a struggle.
0:24:14 > 0:24:19Understanding finances and being more confident with your maths can make things easier.
0:24:19 > 0:24:23BBC Learning has some clever tools to help.
0:24:23 > 0:24:26Michael, how is BBC Learning helping consumers?
0:24:26 > 0:24:30Well, in order to understand the deals that are out there,
0:24:30 > 0:24:32it helps to be able to understand percentages.
0:24:32 > 0:24:35We developed a mobile phone app
0:24:35 > 0:24:39that you can use in a shop or at home when you're looking at your bills
0:24:39 > 0:24:42which will tell you what the final percentage is
0:24:42 > 0:24:45when there is a discount or a percentage added.
0:24:45 > 0:24:46How does it work?
0:24:46 > 0:24:52It shows the price on one side and the percentage on the other side.
0:24:52 > 0:24:55Where can we find out about all of these apps
0:24:55 > 0:24:58and ones we're likely to use in the future?
0:24:58 > 0:25:00Visit the Skillswise website at:
0:25:03 > 0:25:07- All the information about downloading the apps will be there. - Thank you.
0:25:10 > 0:25:14Some really great advice there from the experts at our pop-up shop.
0:25:14 > 0:25:16Thanks again to everyone who came along,
0:25:16 > 0:25:20whether it was to get a problem solved or just to say hello.
0:25:20 > 0:25:22Now, here's someone else with a problem
0:25:22 > 0:25:25and they are not at all happy about it!
0:25:26 > 0:25:31The peace and quiet of rural Carmarthenshire...
0:25:31 > 0:25:36Like many other remote parts of the UK, there's no mains gas supply here.
0:25:36 > 0:25:39So in the bungalow belonging to Chris and Roy Spragg,
0:25:39 > 0:25:42they depend on heating oil to keep it warm.
0:25:42 > 0:25:48It's one of the main fuels because of the rural area that we live in,
0:25:48 > 0:25:52and other than that, you could be having a big problem
0:25:52 > 0:25:57unless you've got anything similar to a log-fire burner or coal fire.
0:25:57 > 0:26:03But most people around here require oil central heating.
0:26:03 > 0:26:04500 litres...
0:26:04 > 0:26:10At the end of 2009, with temperatures well below freezing and supplies running low,
0:26:10 > 0:26:17the Spraggs contacted their regular heating oil supplier, GB Oils, to place an order.
0:26:17 > 0:26:21I was quoted 45p a litre.
0:26:21 > 0:26:26A fortnight went by, the delivery came
0:26:26 > 0:26:28and we were invoiced at 59.95.
0:26:28 > 0:26:32That was a 33-percent increase on what I'd been quoted.
0:26:32 > 0:26:38The difference would've been £156 extra
0:26:38 > 0:26:41on the cost of the delivery.
0:26:41 > 0:26:44Roy got in touch with the company.
0:26:44 > 0:26:46I made numerous phone calls
0:26:46 > 0:26:49for somebody to give me an explanation
0:26:49 > 0:26:52of the difference in the price,
0:26:52 > 0:26:55and we weren't getting any response.
0:26:55 > 0:26:58I was told on one occasion, "Contact the accounts department."
0:26:58 > 0:27:03When I did contact the accounts department, it was, "Go back to the sales department."
0:27:03 > 0:27:08With calls getting them nowhere, Chris tried writing to the company.
0:27:08 > 0:27:10Two letters to them
0:27:10 > 0:27:14and one of them was sent recorded delivery
0:27:14 > 0:27:17so that I knew they'd received it,
0:27:17 > 0:27:18addressed to the manager,
0:27:18 > 0:27:22asking for an explanation
0:27:22 > 0:27:27and that we had spoken, or tried to make contact with them
0:27:27 > 0:27:30without any sort of response from them,
0:27:30 > 0:27:34and they just didn't respond to my letters.
0:27:34 > 0:27:37And it seems the Spraggs weren't the only ones
0:27:37 > 0:27:40who wanted to ask GB Oils some questions.
0:27:40 > 0:27:45Carmarthenshire County Council were also interested in talking to the company.
0:27:45 > 0:27:48In January, 2010,
0:27:48 > 0:27:52we had a complaint regarding the pricing of the fuel
0:27:52 > 0:27:55and an officer went out to meet the company
0:27:55 > 0:27:58and the answers weren't very satisfactory.
0:27:58 > 0:28:01And basically, six more complaints came in
0:28:01 > 0:28:05and we then took out a warrant as a council
0:28:05 > 0:28:08and we went to the company
0:28:08 > 0:28:11and then found that there was hundreds of complaints
0:28:11 > 0:28:16regarding the company's actions on pricing of oil.
0:28:16 > 0:28:20In fact, it seems there were around 400 dissatisfied customers,
0:28:20 > 0:28:24including Roy and Chris Spragg, at the company's premises.
0:28:24 > 0:28:30The problems occurred during the heavy snow and extreme winter of two years ago.
0:28:30 > 0:28:34If they'd got and used the oil they were holding in store
0:28:34 > 0:28:36and taken in new deliveries,
0:28:36 > 0:28:38there could've been an increase in the price,
0:28:38 > 0:28:42but the explanation given that I was delayed with my delivery
0:28:42 > 0:28:44is that they couldn't get out of the depot.
0:28:44 > 0:28:48That meant they should've been delivering the oil that they were holding
0:28:48 > 0:28:50and that's the price they quoted.
0:28:50 > 0:28:55Trading Standards took action against the company for overcharging customers.
0:28:55 > 0:29:02In August 2011, GB Oils were fined £51,000 for 17 separate offences
0:29:02 > 0:29:05under the Unfair Trading Regulations.
0:29:06 > 0:29:10GB Oils told Rip-Off Britain that they fully accept errors were made
0:29:10 > 0:29:15in two of their West Wales depots in the severe winter two years ago, resulting in:
0:29:18 > 0:29:23They admitted those errors in court and stressed the court accepted that these breaches:
0:29:26 > 0:29:29And they've taken steps to ensure these mistakes don't happen again,
0:29:29 > 0:29:34changing their procedures, training and complaints handling so that they're:
0:29:40 > 0:29:42Though the company's apologised to the Spraggs,
0:29:42 > 0:29:46Chris and Roy remain concerned that because of where they live,
0:29:46 > 0:29:51when it comes to energy, they don't have the same choices as most other consumers.
0:29:51 > 0:29:56We can't go elsewhere, we can't use any other form of energy,
0:29:56 > 0:30:00so sometimes the oil people do have you over that barrel,
0:30:00 > 0:30:04whereby we are reliant on them.
0:30:04 > 0:30:07If you think that you could end up in a similar situation
0:30:07 > 0:30:09but don't know where to turn for advice,
0:30:09 > 0:30:12don't worry because we've done the hard work for you.
0:30:12 > 0:30:17Here's some information that should stop you from being caught out.
0:30:17 > 0:30:21There are several things to bear in mind when you're ordering oil.
0:30:21 > 0:30:24Try to order in large quantities
0:30:24 > 0:30:27and try to avoid having to order in the depths of winter.
0:30:27 > 0:30:30The price we cannot predict but, generally speaking,
0:30:30 > 0:30:34it is likely to be more expensive in the depths of winter.
0:30:34 > 0:30:37Get together with neighbours or friends
0:30:37 > 0:30:41or find out if there's a local oil-buying club in your area.
0:30:41 > 0:30:43The Citizens Advice Bureau may know of one
0:30:43 > 0:30:46or your local councillor may know of one.
0:30:46 > 0:30:49If you can buy with neighbours or through a club,
0:30:49 > 0:30:52you're likely to get a better price.
0:30:54 > 0:30:56When you get quoted a price,
0:30:56 > 0:30:59make sure that that is the price you actually pay
0:30:59 > 0:31:01when the oil is delivered.
0:31:03 > 0:31:08But remember, oil is not regulated, unlike gas and electricity,
0:31:08 > 0:31:12so you, the consumer, have to be very sure what you're doing.
0:31:15 > 0:31:19Now, as we heard earlier, nearly 6,000 UK savers lost their money
0:31:19 > 0:31:22in savings plans they thought were low risk
0:31:22 > 0:31:25when Lehman Brothers collapsed in 2008.
0:31:25 > 0:31:30The world now sees that event as the beginning of the global economic crisis,
0:31:30 > 0:31:34but for the individuals concerned, it was the start of dreadful hardship
0:31:34 > 0:31:37and a desperate battle to reclaim their cash.
0:31:38 > 0:31:42In September, 2008, the financial world was rocked
0:31:42 > 0:31:46by the bankruptcy of one of America's biggest banks.
0:31:46 > 0:31:51The collapse of Lehman Brothers helped trigger a financial crisis that swept the globe
0:31:51 > 0:31:55and its demise left over 5,000 UK investors
0:31:55 > 0:31:59£100 million out of pocket.
0:31:59 > 0:32:03It's on the television that Lehman Brothers had gone bankrupt
0:32:03 > 0:32:08and I thought, "It's amazing that an American bank has gone bankrupt"
0:32:08 > 0:32:12but it had no effect on me because I had no investments in Lehman Brothers.
0:32:12 > 0:32:14Or so I thought.
0:32:14 > 0:32:19Though Peter Howard and his wife Christine weren't initially worried by the collapse of Lehman Brothers,
0:32:19 > 0:32:22they were keeping an eye on the stock market
0:32:22 > 0:32:25because they'd put all their life savings, £50,000,
0:32:25 > 0:32:29in a stocks-and-shares investment plan.
0:32:29 > 0:32:31I invested the £50,000
0:32:31 > 0:32:35so that I would have an income that would improve my standard of living,
0:32:35 > 0:32:38so that Christine and I could go out for more meals,
0:32:38 > 0:32:42take better holidays, weekends away,
0:32:42 > 0:32:45just generally have a better quality of life.
0:32:45 > 0:32:48Initially, their investment had worked well.
0:32:48 > 0:32:53They spent the extra income that it generated on small luxuries and holidays abroad.
0:32:53 > 0:32:58But on their return from one of these trips, they got a nasty shock.
0:32:58 > 0:33:04I found a letter telling me that my investment was with Lehman Brothers
0:33:04 > 0:33:07and as such, my investment was affected
0:33:07 > 0:33:08and part of the bankruptcy.
0:33:08 > 0:33:14That was the first Peter had heard of his investment plan being linked to Lehman Brothers.
0:33:14 > 0:33:18The collapse of the bank had taken his life savings with it.
0:33:18 > 0:33:23I was devastated at the thought of losing £50,000
0:33:23 > 0:33:27and I was very upset that I hadn't been told
0:33:27 > 0:33:32that Lehman Brothers were involved in my investment.
0:33:32 > 0:33:37Peter says whilst he knew there was a big financial backer behind his investment plan,
0:33:37 > 0:33:38he didn't know who it was.
0:33:38 > 0:33:43He says if he'd known it was Lehman's, he wouldn't have invested
0:33:43 > 0:33:45because by then, March 2008,
0:33:45 > 0:33:49he'd already seen signs that they might be in trouble.
0:33:49 > 0:33:52He read that their credit rating was likely to be downgraded,
0:33:52 > 0:33:55and though that didn't happen for a few months more,
0:33:55 > 0:34:00he can't understand why their connection to his investment wasn't flagged up.
0:34:00 > 0:34:06They had enough time to tell me that the backer, in the future,
0:34:06 > 0:34:10was not going to be as strong as they'd put in the brochure.
0:34:10 > 0:34:12But they didn't tell me that.
0:34:12 > 0:34:14Convinced that he had grounds to complain,
0:34:14 > 0:34:18Peter began to look into what he could do about it.
0:34:18 > 0:34:20I knew that I could do nothing on my own,
0:34:20 > 0:34:24so I had to get other people and form a group and try and do something,
0:34:24 > 0:34:27and I did this by the internet.
0:34:27 > 0:34:31And so the Missold Investments action group was born.
0:34:31 > 0:34:36"Some of the 6,000 investors caught in the backwash of the Lehman's disaster
0:34:36 > 0:34:40"were pressing their case outside the Financial Services Authority in London yesterday."
0:34:40 > 0:34:42As well as protesting,
0:34:42 > 0:34:46they launched a website offering help and advice to others.
0:34:46 > 0:34:49You've got a June 2008 plan
0:34:49 > 0:34:52and some of those have been compensated.
0:34:52 > 0:34:55The Financial Services Compensation Scheme,
0:34:55 > 0:35:00which is funded by the industry and pays out to victims of investment mis-selling,
0:35:00 > 0:35:03began looking at the Lehman case in 2009.
0:35:03 > 0:35:07A year later, they ruled that though some investors would be entitled to compensation,
0:35:07 > 0:35:11it depended which plan they'd signed up to.
0:35:11 > 0:35:1515 plans went to the Compensation Scheme.
0:35:15 > 0:35:21They judged that ten of them would get compensated and five would not.
0:35:21 > 0:35:27The criteria related to what it said on the front of the brochure.
0:35:27 > 0:35:29The ten who got compensated,
0:35:29 > 0:35:33it said on the front of the brochure, "Capital secure",
0:35:33 > 0:35:35which it obviously wasn't.
0:35:35 > 0:35:39On the brochure for the other five, it said, "Capital at risk".
0:35:39 > 0:35:41But we all knew the capital was at risk,
0:35:41 > 0:35:44we just thought the risk related to the stock market
0:35:44 > 0:35:49and not to the unnamed backer going bust.
0:35:49 > 0:35:53But there's confusion among the investors affected.
0:35:53 > 0:35:57Some who were told they wouldn't be allowed to claim compensation
0:35:57 > 0:35:59have gone ahead anyway and got their money back.
0:35:59 > 0:36:01But Peter isn't one of them.
0:36:01 > 0:36:06They came back in the letter, and there was a lot of legal jargon
0:36:06 > 0:36:09telling me what I needed to prove
0:36:09 > 0:36:12and I didn't understand it, quite frankly.
0:36:12 > 0:36:16So far, over 1,600 people have received compensation,
0:36:16 > 0:36:19but thousands more are still out of pocket.
0:36:19 > 0:36:22Peter thinks some may not have bothered putting in a claim
0:36:22 > 0:36:24because they assume it won't be successful.
0:36:24 > 0:36:29But he reckons it's definitely worth them having a go.
0:36:29 > 0:36:32Depending on what you put on the application form,
0:36:32 > 0:36:36you may get compensated or you may not,
0:36:36 > 0:36:38but we don't know what the difference is.
0:36:38 > 0:36:42It's very confusing. People are very frustrated who are getting refused
0:36:42 > 0:36:47when we're telling them that people with the same plan are getting their cheques.
0:36:47 > 0:36:49And the Howards are determined
0:36:49 > 0:36:52to carry on fighting to get their own money back.
0:36:52 > 0:36:57I've lost my income from that plan for the last three years nearly,
0:36:57 > 0:37:03but my real concern is the loss of the capital, which is the £50,000.
0:37:03 > 0:37:09In my future years, I may need that for medical expenses or carers
0:37:09 > 0:37:12and that's what really worries me, that that's gone.
0:37:12 > 0:37:17Lots of you have lost money as a result of the financial crisis.
0:37:17 > 0:37:20Investments you thought were secure have turned out not to be.
0:37:20 > 0:37:25I'm here to talk to Mark Neale, head of the Financial Services Compensation Scheme,
0:37:25 > 0:37:28to find out how you can get your money back.
0:37:29 > 0:37:31One of the key issues
0:37:31 > 0:37:36is whether or not people who took out policies that clearly stated that there was a risk element,
0:37:36 > 0:37:40people feel that they signed a thing called a risk policy
0:37:40 > 0:37:45but they didn't realise that when they came to you for compensation,
0:37:45 > 0:37:47that this would rule them out.
0:37:47 > 0:37:52We can't protect people against ordinary investment risk,
0:37:52 > 0:37:55risks materialising that they knew about.
0:37:55 > 0:38:00We can only protect people where businesses misled them
0:38:00 > 0:38:03about the nature of the risks that they were running.
0:38:03 > 0:38:08In this case, we've looked carefully at the marketing material
0:38:08 > 0:38:12and the risk that the bank backing these products,
0:38:12 > 0:38:16in this case Lehman Brothers, would fail was flagged to the investors.
0:38:16 > 0:38:21I suppose what they're really saying is that signs of failure were there
0:38:21 > 0:38:25and, in some cases, they were reinvesting
0:38:25 > 0:38:27when Lehman's was looking shaky
0:38:27 > 0:38:30and that they should've been warned.
0:38:30 > 0:38:33Is there no sense of responsibility on your part
0:38:33 > 0:38:37that these type of warnings should be given?
0:38:37 > 0:38:40The Financial Services Compensation Scheme is not the regulator.
0:38:40 > 0:38:43We're here to compensate people
0:38:43 > 0:38:48who lose money when financial businesses fail.
0:38:48 > 0:38:51In this particular case,
0:38:51 > 0:38:57the fact that the bank backing these products had been downgraded
0:38:57 > 0:39:00was notified to the investors,
0:39:00 > 0:39:07who had an opportunity then either to withdraw from the investment or to seek further information.
0:39:07 > 0:39:10When the worst happens, people do turn to you,
0:39:10 > 0:39:14and in the case of one of the people that we're talking about,
0:39:14 > 0:39:17she and her husband applied for compensation,
0:39:17 > 0:39:22were turned down, but she has now won compensation.
0:39:22 > 0:39:26How is it possible that you can say, "No, your claim isn't legitimate"
0:39:26 > 0:39:28and then you can change your mind?
0:39:28 > 0:39:32We look very carefully at the evidence that claimants present to us
0:39:32 > 0:39:34in support of their claims.
0:39:34 > 0:39:38If claimants can present us with further and new evidence,
0:39:38 > 0:39:42we will always consider it, and that's what will have happened in this case.
0:39:42 > 0:39:47It suggests that people have to be prepared for quite complex negotiation with you
0:39:47 > 0:39:49in order to pursue their claims.
0:39:49 > 0:39:55This woman happened to go the extra mile and she succeeded, but some people might not do that.
0:39:55 > 0:39:59We work very hard to make the process of claiming from us
0:39:59 > 0:40:02as straightforward as we can.
0:40:02 > 0:40:05We also have a telephone helpline
0:40:05 > 0:40:10for claimants who struggle to understand our processes
0:40:10 > 0:40:13and we're always very happy to offer advice and guidance
0:40:13 > 0:40:16on the completion of our claim forms.
0:40:16 > 0:40:18And in general terms,
0:40:18 > 0:40:21if you had one particular piece of advice to give to people
0:40:21 > 0:40:25to try to avoid this situation, what would it be?
0:40:25 > 0:40:28I think my overriding piece of advice would be,
0:40:28 > 0:40:33if you're thinking of investing in a quite complex investment product, like a structured product,
0:40:33 > 0:40:38please make sure that you read about the risks of that product,
0:40:38 > 0:40:41please make sure you understand those risks
0:40:41 > 0:40:45and please be sure that you're happy to live with the worst that could happen,
0:40:45 > 0:40:49because just from time to time, the worst will happen.
0:40:51 > 0:40:56Here at Rip-Off Britain, we're always ready to investigate more of your stories.
0:40:56 > 0:40:59Confused over your bills
0:40:59 > 0:41:04or trying to wade through endless small print that leaves you none the wiser?
0:41:04 > 0:41:06I might've been stupid for not reading it,
0:41:06 > 0:41:09or I've read it and not took it in.
0:41:09 > 0:41:11I could kick myself, I really could.
0:41:11 > 0:41:14Unsure what to do when you discover you've lost out
0:41:14 > 0:41:18and that so-called great deal has ended up costing you money?
0:41:18 > 0:41:24I thought, "This cannot be true. It's totally unacceptable." I was so angry!
0:41:25 > 0:41:27You might have a cautionary tale of your own
0:41:27 > 0:41:31and want to share the mistakes you made with us, so others don't do the same.
0:41:31 > 0:41:33No-one knows about this.
0:41:33 > 0:41:37This is very strange to me and I would like to get this clear.
0:41:38 > 0:41:40You can write to us at:
0:41:49 > 0:41:51Or send us an email to:
0:41:56 > 0:41:59The Rip-Off team is ready and waiting
0:41:59 > 0:42:02to investigate your stories.
0:42:03 > 0:42:09It's clear that choosing where to invest your money isn't a straightforward decision.
0:42:09 > 0:42:13Even when you've done your homework, things can go horribly wrong.
0:42:13 > 0:42:15You can never reduce the risk entirely,
0:42:15 > 0:42:18but you can protect your money by spreading it around.
0:42:18 > 0:42:22You know the old adage - don't put all your nest egg in one basket.
0:42:22 > 0:42:26And despite what you may be told and whatever you're investing in,
0:42:26 > 0:42:28there are absolutely no guarantees.
0:42:28 > 0:42:33Absolutely right. Our website...
0:42:33 > 0:42:37has got lots more advice you'll find really useful.
0:42:37 > 0:42:39That's all we've got time for today.
0:42:39 > 0:42:43Thanks for joining us. We'll see you again very soon.
0:42:43 > 0:42:47- Until then, from all of us... - ALL: Bye.
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