Question
I trusted a financial adviser and he invested some money for me with Skandia in the Isle of Man for a period of five years. It has lost money consistently. (The five years is up now).
I still have a Collective Investment Fund and the fund has been 'frozen' now for almost a year and a half. It is the Frontier Property Fund. I've lost my home, well, I've lost everything because I can't get this money. How long can they 'freeze' peoples money for? Why should these Companies be allowed to do this?
I'm quite in despair about all this and keep getting sent round in circles. Any advice you could give me would be greatly appreciated.Answer
I’m sorry to hear about your difficult situation.
The financial adviser appears to have sold you an offshore investment bond offered by insurance company Royal Skandia, for which he or she probably pocketed around 6% or more initial commission.
An investment bond is effectively a ‘tax wrapper’ that holds investments, in this case the (rather expensive) Frontier Commercial Property fund.
The five year period you mention is simply the minimum holding period to avoid a surrender penalty – basically a charge levied by Skandia to make up for the commission they’ve paid to the adviser but haven’t had time to deduct via the bond’s charges.
The reason you can’t get hold of your money is that the Frontier Property Fund closed its doors to redemptions on 1 August 2008 (details here) and has yet to re-open them.
Why? Well it invests in a range of commercial property funds, some of which have in turn suspended redemptions until they can sell sufficient property to repay those investors who want out. This is all a result of commercial property markets taking a battering during the credit crunch.
However, commercial property markets have generally been improving in recent months, so I would expect Frontier to open its doors to redemptions sooner than later. I’d suggest keeping in regular contact with Frontier Capital (your adviser should be doing this is they’re still bothering to look after you) to establish which underlying funds remain closed and when trading is likely to re-commence.
I’m afraid there’s little else you can do unless you feel the adviser mis-sold you the bond. If you explicitly told the adviser you needed access to the money after five years and/or you didn’t want to risk the money, then you might have a case. Otherwise, and I know it’s the last thing you want to hear, you’ll have to carry on waiting.
I trusted a financial adviser and he invested some money for me with Skandia in the Isle of Man for a period of five years. It has lost money consistently. (The five years is up now).
I still have a Collective Investment Fund and the fund has been 'frozen' now for almost a year and a half. It is the Frontier Property Fund. I've lost my home, well, I've lost everything because I can't get this money. How long can they 'freeze' peoples money for? Why should these Companies be allowed to do this?
I'm quite in despair about all this and keep getting sent round in circles. Any advice you could give me would be greatly appreciated.Answer
I’m sorry to hear about your difficult situation.
The financial adviser appears to have sold you an offshore investment bond offered by insurance company Royal Skandia, for which he or she probably pocketed around 6% or more initial commission.
An investment bond is effectively a ‘tax wrapper’ that holds investments, in this case the (rather expensive) Frontier Commercial Property fund.
The five year period you mention is simply the minimum holding period to avoid a surrender penalty – basically a charge levied by Skandia to make up for the commission they’ve paid to the adviser but haven’t had time to deduct via the bond’s charges.
The reason you can’t get hold of your money is that the Frontier Property Fund closed its doors to redemptions on 1 August 2008 (details here) and has yet to re-open them.
Why? Well it invests in a range of commercial property funds, some of which have in turn suspended redemptions until they can sell sufficient property to repay those investors who want out. This is all a result of commercial property markets taking a battering during the credit crunch.
However, commercial property markets have generally been improving in recent months, so I would expect Frontier to open its doors to redemptions sooner than later. I’d suggest keeping in regular contact with Frontier Capital (your adviser should be doing this is they’re still bothering to look after you) to establish which underlying funds remain closed and when trading is likely to re-commence.
I’m afraid there’s little else you can do unless you feel the adviser mis-sold you the bond. If you explicitly told the adviser you needed access to the money after five years and/or you didn’t want to risk the money, then you might have a case. Otherwise, and I know it’s the last thing you want to hear, you’ll have to carry on waiting.
Read this Q and A at http://www.candidmoney.com/questions/question143.aspx
No comments:
Post a Comment