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Original poster

Really strange error & now mum owes thousands- help

441 replies

Helpmymum · 28/03/2021 19:18

I'll try and keep this as simple as possible, I'm just seeing if anyone has any advice or insight into how this might play out before we start contacting people tomorrow.

My elderly, widowed & (totally alone for the past year 😪) mother got a letter late Friday afternoon which was spent special delivery from a pension company. In short, it said that she took a bond out 20 years ago which was cashed in 15 years ago and her account was closed, she was no longer a customer. They then said that they are really sorry but they have just discovered during an audit that they had mistakenly used her bank account details with another bond for another customer and she has been receiving a monthly payment for the last 20 years in error. This amounts to an awful lot of money, tens of thousands of pounds. And it needs to be repaid. We have checked and she has been receiving the payment in her account.

She was widowed a long time ago and when my father died, my sister and I where both toddlers and so she employed a financial advisor to deal with the finances, obviosuly to eliviate the stress. She is not wealthy by any means, she owns a modest house (which was paid for by my dad's life insurance policy), has a small amount of savings (which is with the financial advisor invested in whatever he thinks) and collects her pension.

I can understand why she wouldn't question this money going in as she just left everything to the financial advisor, he obviously opened the bond and cashed it out and payments of this nature were expected/ perfectly normal.

After receiving the letter, my sister immediately called the financial advisor who said he had never dealt with anything like this before and was working from home, he would need to go into the office on Monday morning to have a look at the records. My sister then called the company in question, it's a large, well known company so she didn't take the number from the letter just incase it was a scam and found the number from Google. She called and a person in the company could not find any record of this or the letter having been sent out, however she did say she wasn't part of the relevant department and the person who's signature was on the letter did infact work there. It was so late on Friday afternoon, there was no one there who could help or knew anymore.

My poor mum has been in an absolute state all weekend, she's thinking she is going to have to sell her house to pay this back. I think technically she does owe the money as we can see she has recieved it. Does anyone have any idea of what might happen?

First thing tomorrow is a call to citizens advice and legal advice, obviosuly talk to the financial advisor and the company in question too.

I think I'm just asking if anyone knows what we might be in for here?

Thanks

OP posts:
thesandwich · 28/03/2021 20:27

Check if she has legal cover with her house insurance. Could be useful

Sittingonabench · 28/03/2021 20:28

First I wouldn’t panic. If it isn’t a scam which needs to be verified, you have the opportunity to negotiate how this will be paid back, it is their error and so the responsibility lies with them. Some options to consider

  1. Payment upon her death - taken from her estate - this may not be a goer for them as it’s a bit of an unknown however I would change my arm, and be sure there is no/minimal interest in the negotiation (it isn’t a loan she chose to take out)
  2. A monthly repayment of a nominal amount (depends on the figures) which does not impact her standard of living with the balance being from her estate upon her death. Again beware interest.
  3. Some kind of agreement whereby she provides equity in her home for the percentage value of the debt - this should be the most attractive to them as it is likely the investment will grow but may be problematic due to restrictions they have internally and would definitely cause problems if there is any mortgage still left on the house.
Your red line should be a payment that does not impact her standard of living and i would get advice as to how to ensure this is the agreement. Maybe look through records to see how much her outgoings are and include a bit extra for emergencies and inflation. Really hope all this works out but don’t rush or panic and try to make sure your Mam doesn’t worry too much.
Changeythenamey · 28/03/2021 20:28

If this is genuine then she will be given the opportunity to pay it back in the same time frame she acquired it. Verify that it is genuine. If so, lodge a formal complaint and after the complaint is resolved, refer to the pensions or financial ombudsman. This will buy time. She shouldn’t be forced to sell her home in my experience.

whataboutbob · 28/03/2021 20:28

Scam scam scam.
But just in case it isn’t, if she had good reason to believe the ones was legitimately hers, case law has precedent for money paid in error not to be re -imbursed. I would not be taking their word for it, and even if the company is legitimate she might have a strong case for keeping the money.

quicklybeingdrivenmad · 28/03/2021 20:29

Scottish Widows messed up so much when my dad died took me 2 years to sort it, not sure if your circumstances are the same my mum left everything to dad , never had a clue what they had in bonds she just signed , thats what happened back in the day, so either they or your financial advisor should be at fault ,at our old house we got a statement every year for the previous, previous, previous owner for a bond similar worth now about £70k, contacted everyone with same surname on facebook. will never know what happens to it

Crazycatlady83 · 28/03/2021 20:29

@alreadytaken I do think we should describe it - the more information out there for people on how these people operate, the better.

GetOffYourHighHorse · 28/03/2021 20:30

If it is correct then it is their error so if it came to it your dm would repay a nominal amount per month over years and years, no need to sell her house and pay it all back at once.

Yes you need legal advice but ime if it can be proven the company made an error then it could even be written off. Go in all guns blazing, she had a financial advisor. It's their fault if they don't audit and keep a check of things.

TheGlassBlowersDaughter · 28/03/2021 20:31

It doesn't sound like a scam. It's also a fairly common problem so I'm surprised your financial adviser isn't aware of it. Pension companies are notoriously slow to catch on to issues like this. We had similar with our aunt.
Speak to CAB tomorrow. You should be able to arrange a payment scheme. Also depending on the exact details, sometimes some debts can be written off. Remember to tell CAB about the financial adviser. If the adviser made an error ie didn't tell your DM that the payments should have stopped then he may be able to claim on his insurance rather than your DM having to pay it back. They won't want to do that but it's worth discussing with CAB.

underneaththeash · 28/03/2021 20:32

I wouldn't worry.
Write back and state that you have no record of the bond being cashed and then leave it in their court. You may need to get the financial ombudsmen involved.

Your financial advisor would not have been able to do this without your mother's knowledge.

MsFogi · 28/03/2021 20:32

Be very careful my mother got a letter (and a number of very realistic phone calls) about some shares she/my father had held and it took me quite a while to get to the bottom of it being a scam. I reported it to the FCA because it was so realistic (complete with excellent, professional website etc).

raincamepouringdown · 28/03/2021 20:33

If it's not a scam, get legal/financial advice. Their awful mistake; they should be insured for it.

alreadytaken · 28/03/2021 20:34

Do not offer anything! You have then admitted there is a debt. Yes she received the money but it was not her mistake, she genuinely believed it was her money, she has spent it and it would cause her hardship to pay it back. The only snag with this is that she should have noticed payments stopped 6 months ago and taken it up with her financial advisor then. If she had done that she would have an even stronger case for retaining the money.

If you mother feels she should pay it back, regardless, then the idea that they have a charge on the property would make sense - but argue that it should be no more than a few years payments as they should have discovered their error much sooner.

Puzzledandpissedoff · 28/03/2021 20:34

if they stopped the payments 6 months ago then why have they only just sent this letter now?

Why indeed? And more to the point what's the person who should have received the money been doing for the last 20 years?

If this is real, then please get very careful advice before saying anything at all

Milliepossum · 28/03/2021 20:35

Please see someone in person at the company premises and not only talk on the phone. I’m surprised they will even talk to you instead of your mother given privacy laws. But first get legal advice as others have said. If it’s real it could be they don’t even have the original records anymore and can’t prove anything.

FlyingBurrito · 28/03/2021 20:39

@Puzzledandpissedoff

if they stopped the payments 6 months ago then why have they only just sent this letter now?

Why indeed? And more to the point what's the person who should have received the money been doing for the last 20 years?

If this is real, then please get very careful advice before saying anything at all

In my job I have had to deal with vaguely similar organisations over the past year and I'm sure my experience isn't unique in finding that everything is understandably tediously slow.

They may well have sent other letters that haven't been delivered during that time, my work has also had issues with Royal Mail, which is why they've done recorded delivery now

doublehalo · 28/03/2021 20:41

It's a scam- and if it's not then no way in hell I'd be paying back a penny to them.

winterchills · 28/03/2021 20:43

Definitely sounds like a scam to me too! Make sure she doesn't pay a penny until it's clearly all confirmed

AcornAutumn · 28/03/2021 20:44

@Helpmymum

Yes I also thought straight away too that surely there's a person out there that has been missing this payment for the past 20 years and they would of noticed! I havn't had a chance yet to look through all her bank statements or confirm with the bank where the money has been coming from yet. We will hopefully get a call from the financial advisor in the morning with more information. I'm just not sure whether to speak to the company first thing before getting legal advice?
If you speak to them, ask them to send things in writing and don't say anything yourself. It could still be a scam. Not least that someone is taking payments your mum should get.

Can Citizens Advice Bureau help?

alreadytaken · 28/03/2021 20:44

@Crazycatlady83 people dont always shred or burn paperwork when they should - those that do are less likely to fall victim to scammers.

Cant go to the financial ombudsman until a dispute has been resolved or you pass a certain length of time. So if genuine and they insist on repayment get a formal statement of that then go here www.financial-ombudsman.org.uk/

AcornAutumn · 28/03/2021 20:46

Just as an example

Mum got calls about fraud from a scammer who had cloned the bank's fraud department number.

It is amazing what they can do.

TillyTopper · 28/03/2021 20:46

I would assume a scam. But if it isn't no way would I pay anything back until it's gone to the financial ombudsman and court.

Cavagirl · 28/03/2021 20:47

Hi OP

If this is genuine it suggests an enormous mistake and there's no chance the company will be able to request an immediate repayment. If she needs to pay anything back at all, your mum will have a very long time with very small amounts. So please tell her to try to stop worrying (of course easier said than done).

I would contact citizens advice first thing rather than contacting the company in question. They can help you with next steps and - importantly - what your mum's repayment obligations might be, and whether you might want to get legal advice.
They are doing consultations over the phone or also zoom in some instances www.citizensadvice.org.uk/

Importantly - don't let the fear and worry drive you into hasty decisions or actions. Take your time. If real, it's a very irregular mistake that's 20 years old, it will not be solved overnight, no one will expect it to be solved overnight, so please don't do anything rash or hasty. Get proper advice and don't be rushed. Good luck!

SeasonFinale · 28/03/2021 20:47

Of not a scan they are time barred from suing for any amount over 6 years old. Even then they may be unable to recover the money under estoppel. Get legal advice and do not acknowledge or accept their is a debt due. Merely state you will seek advice.

Crazycatlady83 · 28/03/2021 20:48

@alreadytaken so true. Or companies themselves not being careful with your data! I had a post pop up on FB tonight posted by the Police saying scammers are getting more and more sophisticated. This one was that the scammers called from genuine police numbers (so if you googled the number it would look legit!)

Sorry, OP - no more derailing! I really hope you get it all sorted. Do speak to a solicitor experienced in this type of matter.