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 Shah Mahmood Qureshi, thank you for  When we asked you to tell us about

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 the rip-offs that affected you, you  didn't ds appoint.

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 Are you going to knock on the bad  people's door? We will be taking

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 the Chief Executives to task.  We surveyed over 2,000 UK

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 households to get your opinions and  our Rip-Off Britain mailbags have

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 been filled with your stories.  We've read every single one and now

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 we can reveal our round-up of the  top rip-offs that are driving you

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 crazy.  Welcome to Rip-Off Britain a new

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 consumer programme in which we are  going to be investigating those

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 rip-offs that really drive you mad.  This week we are taking on the

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 major companies on behalf of those  with a small voice.

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 Today, it is the banks we've got in  Bumper bonuses and banks in crisis.

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 The battle for our cash is well and  truly on. With every penny counting,

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 we are here to make sure that you  are not being ripped off and you

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 have given us plenty plenty to work  with. You told us about the banks

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 that cash in after your death.  She said it would be about £325 an

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 hour and the total was going to  come to £25,000. I was horrified.

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 The small print clauses that come  with a hefty price tag.

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 Banks know we don't read the small  print. They rely on it.

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 As well as hearing the stories you  told us throughout the series, each

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 day we will unveil the results of  our exclusive Rip-Off Britain

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 Survey.  We asked what you thought about the

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 banking industry and there are a  few surprises.

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 Time to find out what really gets  on your nerves.

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 We start with one of the biggest  names on the high street, Barclays

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 Bank. In the first-half of this  year it reported pre-tax profits of

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 almost £3 billion. Impressive stuff,  well less impressive is the advice

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 it gave to customers which led to  their life savings being almost

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 David and Sheila Morgan should be  enjoying their retirmt, but they

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 are -- retirement, but they are not.  They turned to the bank they had

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 been with almost half a century for  financial advice, but that turned

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 out to be a costly mistake. In  January of this year, they received

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 the devastating news that they lost  a staggering £188,000. It gave us a

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 bitter feeling in our mouth to know  we had been mis-sold the fund in

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 the first place.  The Morgans had been encouraged by

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 Barclays to invest their saves  savings in the Aviva Global scal

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 balance Fund.  We made an appointment to see a

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 financial adviser in Barclays. She  said they had talked to her bosses

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 and this was very safe and they  would recommend we put it into the

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 one fund.  So David and Sheila invested

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 £360,000, earning Barclays a nice  fat commission.

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 You would never if you were a  responsible adviser put all the

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 eggs in one basket as it were.  Investment funds are grade indeed

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 terms of risk. The one David and  Sheila went with was deemed to be

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 adventurous, but crucially that  information was not given to them.

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 Richard Davis believes cases like  the Morgans are the tip of the

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 iceberg.  I saw three people in in two-days

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 who had the same complaint and it  became apparent that this was

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 endemic or an epidemic of bad  advice that Barclays was following

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 around the country from different  branches.

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 We worked all our life to get it  and we hadn't got a big pension and

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 we relied on this money to take us  through our old age and we lost

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 over 50% of it.  Later, we ask Barclays for answers

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 and reveal how the Morgans weren't  It is a cause of great concern to

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 many of us, identity theft is said  to be one of the fastest growing

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 crimes in Britain, but is the  protection the banks are offering

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 us from this £1 billion rip-off  It is a nightmare scenario. Someone

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 accesses your personal details,  steels your identity and creates a

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 second you, running up debts you  will be responsible for.

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 So when your bank offers insurance  to cover the cost of identity fraud,

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 it might sound like a sensible  thing to do, but at up to £80 a

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 year, fraud ID insurance maybe an  easy way for them to profit from

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 our fears.  For most people identity fraud

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 insurance is a waste of money. It  is an easy sell because it is the

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 idea that you don't want to be a  victim of identity fraud and you

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 don't want to be alone if you are  trying to get your money back or

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 deal with your credit record. The  liability rests with the banks,

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 unless you have left your card  around or given your details to

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 fraudsters, you will get your money  back, the most you might have to

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 pay is £50.  £50 is the limit that the Banking

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 Code of practise sets out as the  most consumers are responsible for

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 should they be the victim of fraud  so you don't need insurance to get

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 your money back or set the record  straight.

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 If you have had something stolen,  an account has been opened in your

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 name. You need to contact one of  the credit reference agencies and

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 they have the victims of fraud team  where they will help you rebuild

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 your credit history. They will  contact the other credit reference

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 agencies for you. Although ID fraud  is a growing crime, it affects less

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 than 70,000 people a year. The best  way to fight identity fraud is by

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 taking care of our personal details.  What I recommend consumers do is

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 check yir credit file -- their  credit file from time to time. You

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 can get it free if you sign up to  credit monitoring services for 30

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 days. Check your bank statements  and things like don't leave

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 receipts around, but just make sure  you keep control of your data. It

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 is data about you, treat as as  value bli as you would leave cash.

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 If you think of it in monetary  terms, you might treat it more

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 carefully.  Still to come, we asked you to tell

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 us how you have been ripped off and  you filled our postbag and ibox

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 with your stories. We have a round-  up of the worst of your banking

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 experiences including how the banks  can make money from you, even when

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 you're dead.  Back to Barclays and the investment

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 fund that their staff recommended  leaving some customers thousands of

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 David and Sheila Morgan feel ripped  off. They were adviced to put their

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 life savings into an investment  fund and were assured that it was a

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 safe bet.  But they ended up losing thousands

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 of pounds. Their bank, Barclays,  recommended they they invest in the

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 Aveeia A Aviva Fund.  We contacted Barclays to see why

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 their advice had gone wrong.  They admitted they made a mistake

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 in classifying the fund and told us  they offered redress to David and

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 Sheila and are reviewing their  practises to ensure it doesn't

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 happen again.  The Morgans aren't alone in feeling

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 misled. It is thought hundreds of  people could have been affected.

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 91-year-old Isaac Price received a  payout of £200,000 as a result of

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 his complaint.  Investing large amounts of money

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 will always come with a risk and  should never be taken lightly.

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 Financial expert, Annie Shaw thinks  we wrongly rely on our banks to

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 keep our savings safe and to give  us the answers.

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 The bank manager used to be a  member of the community. You played

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 golf with him. You meet him at  church. This is not how banks are

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 run these days. They are there to  serve their shareholders. To make

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 money and that's quite right for a  big business, but you as a consumer,

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 have to be aware that's what is  going on.

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 As for the Morgans, they have  rejected the compensation offered

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 by Barclays and are fighting on by  taking their case to the Financial

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 Ombudsman.  I'm joined by the financial expert

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 that we saw in the film, Annie Shaw.  The lesson from that film is that

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 you should not put all your eggs in  one basket? Definitely not, that's

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 the rule of investing in whatever  you choose to put your money

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 because if anything happens to it,  it is all at risk. You should

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 diversify and put your money in  different places and in different

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 asset classes so that might be some  savings, some stock markets.

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 Spread the risk? Yes, definitely.  Clearly with investment rates at

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 0.5% people are going to be tempted  to take something that's higher

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 risk if they want to ensure that  they are going to have some kind of

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 income for the future?  Unfortunately, that tends to be a

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 direct correlation between risk and  reward. My add rise is to really,

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 really -- advice advice is to  really, really assess your attitude

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 to risk. If you cannot bear to lose  one penny, you cannot do that. You

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 must not take any risk at all. If  you think, "I can maybe lose a

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 bit." That opens up a few more  possiblities. You have to speculate

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 to accumulate. If you can risk all  your money, maybe you will make

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 millions, but maybe you will lose  your shirt. Where the problem

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 arises is where people don't want  to take risk. They think the risks

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 are non-existent or minimumal, but  get lured into taking what amounts

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 to a fair amount of risk and this  is the problem that perhaps banks

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 have been minimising what the risks  have been.

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 If you are mis-sold something, what  recourse do you have? If they have

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 been genuinely mis-sold, you should  be able to get compensation. If you

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 have got a genuine complaint and  and often it is difficult to

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 ascertain whether you have, you  should first first complain to

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 theperson who sold you the product  and if they don't play ball, you

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 can go to the Financial Ombudsman  to make a complaint and they will

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 rule, but the problem is whether it  has been a mis-selling case or

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 whether it has been an  misunderstanding. The banks should

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 be explaining everything fully, but  the point is that they are salesmen.

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 They are trying to make a sale.  The bottom line is, don't trust the

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 banks because you can't assume that  they are going to have your best

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 financial interests at heart?  No, not really because banks will

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 only sell you what they have got on  sale and something a different

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 product from a different supplier  might be what you need, but the

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 bank is not going to tell you about  it because it doesn't sell it.

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 Don't go to a bank for financial  advice? Anybody would be mad to go

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 to their bank for advice. That's  not what you go for. You go to open

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 an account and buy a product you  researched yourself and you

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 understand. You do not go to a bank  for advice. You would be crazy.

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 Would you be inclined to trust  financial advice from your bank?

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 It seems not.  Our independent survey of consumers

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 across the UK revealed that just  13% of you would trust the advice

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 given to you by your bank.  It is not something we like to

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 think about, but getting your  affairs in order before you die

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 should save your loved ones time  and money. The administering of

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 your estate or probate isn't  something that should be taken

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 lightly because a wrong call can  Francis's father died this year.

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 His affairs were in order, but the  family were shocked when they saw

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 the fees being charged to settle  his estate.

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 £600,000 is the value of his estate.  4% equates to £24,000, plus the VAT

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 and dispersement we might be  talking about £26,000 which we felt

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 was extortionate.  Francis's father left his estate to

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 his widow and was concerned his mum  was being ripped-off.

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 Francis Francis asked for a meeting  with the probate adviser.

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 I put it to them we would like to  shop around to find alternative

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 solicitor to say deal with the  probate. He said they are down on

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 the will as an executor and that  was their duty and we had no choice

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 in the matter. We have been  distressed enough with my father

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 passing on. Now my my mum is ill.  The reason that I'm trying to

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 pursue this is so I can release  funds from my father's estate so

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 that they can be used tor the care  of -- for the care of my mother.

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 Francis's situation is far from  unusual. When Adam's father died,

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 he found himself with a similar  battle on his hands. When he

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 contacted his dad's solicitor about  his will.

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 She said it would be £325 an hour  and the total was going to come to

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 £25,000. I was horrified. I went  online and did research and within

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 a few hours, I managed to get a  quote for £6300 for the same job.

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 With a huge difference in cost,  Adam decided to change solicitors

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 only to fin the law was not on his  side. We will We will find out how

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 Now we know how keen the banks are  to get their hands on our cash and

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 when it comes to savings, there  seems to be a host of offers for us

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 to take advantage of. If you don't  read the small print you may not be

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 Cliff once worked in the financial  services industry, but switched

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 sides to become a journalist and  money adviser, a poacher turned

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 gamekeeper. When it comes to  savings, he knows the pit falls to

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 look out for.  Savings accounts are like icebergs

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 because nine tenths of what is  important is hidden below the

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 surface. Banks tend to lure you in  with a headline rate, so the devil

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 is in the detail and it pays to  look into what you've bought.

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 According to Cliff there are two  traps to avoid.

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 One of the biggest trap trap  introducktry bonus. This lasts six

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 or 12 months. The problem is, once  that ends, your short-term cherry

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 picks a long-term lemon. It is  probably best to move on when that

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 ends. The other thing is when banks  claim to have easy access, but

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 penalise you. If you withdraw a  fiver, you will lose a month's

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 interest on your balance.  It is all in the small print. The

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 problem is, we don't always read it.  Banks know we don't read the small

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 print. In fact, they rely it. We  end up with terms and conditions

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 seven pages of small print. Do you  have the time to read all of this?

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 I don't and it is my job.  Even if we do bother to read the

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 small print, there is a chance we  won't understand it.

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 Marie Claire says often it is  imcome prehencable.

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 We looked at the definitions they  have given for the terminology in

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 the leaflet. For instance, "the net  Rape rate is -- the net rate is an

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 illustrative rate. In brackets the  tax position affecting our accounts

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 is subject to changes in the law."  What that actually means in plain

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 English is the rate of interest  after tax has been taken off. Why

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 make it so difficult and long wind  ad why use those words that people

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 are not familiar with?  If D'Arcy agrees, but until we read

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 the small print, we will keep on  It is not just the small print on

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 savings accounts that you have got  to watch out for. It is It is

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00:17:37,728 --> 00:17:41,552
 everywhere. Take credit cards. We  know that they are an expensive way

219
00:17:41,592 --> 00:17:46,036
 of borrowing so more and more of us  are swapping cards and transferring

220
00:17:46,076 --> 00:17:59,408
 balances to take advantage of  berates. But if you don't pay

221
00:17:59,448 --> 00:18:03,068
 attention to the terms and  With the highest number of credit

222
00:18:03,108 --> 00:18:06,928
 card borrowers in Europe, here in  Britain we love spending on our

223
00:18:06,968 --> 00:18:10,380
 cards.  But we don't love the charges.

224
00:18:10,420 --> 00:18:13,428
 You get a credit card thinking it  will help you out financially and

225
00:18:13,468 --> 00:18:16,680
 you wrack up the development  I don't think they give you long

226
00:18:16,720 --> 00:18:20,208
 enough to pay it off and the  charges are too high.

227
00:18:20,248 --> 00:18:23,784
 According to the consumer  association, Which?, those charges

228
00:18:23,824 --> 00:18:28,444
 are actually getting higher,  despite a fall in the cost of

229
00:18:28,484 --> 00:18:34,332
 borrowing.  Over the last 12 months, Bank of

230
00:18:34,372 --> 00:18:39,816
 England rate has fallen from 5% to  0.5%. Over the same period,

231
00:18:39,856 --> 00:18:44,896
 interest rates on credit cards have  gone up from around 16% on average

232
00:18:44,936 --> 00:18:48,556
 to 17%. That's ridiculous.  It is not only rate increases that

233
00:18:48,596 --> 00:18:53,224
 have been costing the consumer  money, even those people who signed

234
00:18:53,264 --> 00:18:59,332
 up to a 0% balance transfer deal  could find themselves paying more

235
00:18:59,372 --> 00:19:06,916
 than they bargained for.  Leo thought he was getting a good

236
00:19:06,956 --> 00:19:12,600
 deal when he moved his balance of  £12,000 on to a 0% credit card.

237
00:19:12,640 --> 00:19:16,460
 I transferred the balance to get  the six month 0% interest rate.

238
00:19:16,500 --> 00:19:21,128
 agreed to a direct debit of £200 a  month to pay off the balance.

239
00:19:21,168 --> 00:19:26,008
 But he didn't realise this wasn't  enough to cover the minimum payment.

240
00:19:26,048 --> 00:19:32,224
 As a result they put my interest  rate up from 0%, the reason I

241
00:19:32,264 --> 00:19:39,412
 joined the credit card in the first  place. They put it up to 34.9%.

242
00:19:39,452 --> 00:19:42,664
 He now pays £250 each month in  interest payments alone.

243
00:19:42,704 --> 00:19:46,320
 They rely on the fact that people  don't scrutinise every line in

244
00:19:46,360 --> 00:19:51,536
 their statement and soon as that  minimum fee isn't met, they hike up

245
00:19:51,576 --> 00:19:55,916
 the interest rate. This is the sort  of way I would expect a loan shark

246
00:19:55,956 --> 00:19:59,072
 to operate.  If you have got a credit card,

247
00:19:59,112 --> 00:20:06,400
 right now, it is critical that you  do not miss payments. It is crit

248
00:20:06,440 --> 00:20:10,056
 keel that you -- critical that you  don't let your credit card provider

249
00:20:10,096 --> 00:20:14,120
 sting you fees.  Leo is determined not to fall into

250
00:20:14,160 --> 00:20:20,008
 the same trap again.  In future, I will try and stay away

251
00:20:20,048 --> 00:20:30,492
 from credit cards at every turn.  But if I have to have a credit card,

252
00:20:30,532 --> 00:20:34,976
 I will scrutinise every statement  Coming up, we made a UK wide appeal

253
00:20:35,016 --> 00:20:37,400
 for your tales of rip-offs and this  week, we are on the case of some of

254
00:20:37,440 --> 00:20:42,072
 Britain's biggest businesses on  your behalf.

255
00:20:42,112 --> 00:20:48,088
 In the final part of our round-up  of the top rip-offs, we will be

256
00:20:48,128 --> 00:20:52,744
 hearing how some pension options  could put you on the road to ruin.

257
00:20:52,784 --> 00:21:03,228
 When putting your affairs in order  after your death, it is fair to say

258
00:21:03,268 --> 00:21:09,280
 your priority is to benefit your  Probate is big business. Generating

259
00:21:09,320 --> 00:21:13,588
 £1 billion a year.  The prices charged can vary as Adam

260
00:21:13,628 --> 00:21:23,400
 Walker found out when he saw how  much the executors of his father's

261
00:21:23,440 --> 00:21:27,184
 will intended to charge him.  He was a very very frugile man all

262
00:21:27,224 --> 00:21:30,104
 his life. It was an appropriate  amount of money for the work

263
00:21:30,144 --> 00:21:34,588
 involved.  Adam was keen to charge solicitors,

264
00:21:34,628 --> 00:21:38,852
 but removing an executor isn't easy  because they have no legal

265
00:21:38,892 --> 00:21:42,716
 obligation to stand down. Banks and  solicitors refuse to do so claiming

266
00:21:42,756 --> 00:21:47,184
 that that they are fulfilling the  requests of the deceased.

267
00:21:47,224 --> 00:21:51,280
 I said that if she insisted on  doing the work I would be a hostile

268
00:21:51,320 --> 00:21:54,120
 client and I would complain to the  Law Society that she was

269
00:21:54,160 --> 00:21:58,388
 overcharging and ask for an  independent assessment of the bill.

270
00:21:58,428 --> 00:22:04,200
 And when I said that, with a lot of  ill grace, she agreed to drop the

271
00:22:04,240 --> 00:22:07,932
 case. I shouldn't have had to do  that at that time. It was a a

272
00:22:07,972 --> 00:22:12,516
 horrible, horrible experience, all  I wanted three weeks after my

273
00:22:12,556 --> 00:22:20,000
 father died was to mourn his  passing in peace and to have that

274
00:22:20,040 --> 00:22:25,764
 battle was just shocking at that  time.

275
00:22:25,804 --> 00:22:30,028
 In Kent, Francis is still fighting  for a better deal for his

276
00:22:30,068 --> 00:22:37,248
 motherment they were -- mother.  They were quoted a probate fee of

277
00:22:37,288 --> 00:22:43,748
 £25,000 after the deft Francis --  death of Francis's father. Francis

278
00:22:43,788 --> 00:22:49,232
 is determined to fight on.  I have been shopping around. They

279
00:22:49,272 --> 00:22:53,496
 have quoted me a figure of £2400  maximum for dealing with an estate

280
00:22:53,536 --> 00:22:56,748
 of my father's size.  A test case to decide if banks and

281
00:22:56,788 --> 00:23:00,000
 solicitors can be prevented from  taking large chunks out of people's

282
00:23:00,040 --> 00:23:04,672
 inheritance is due to be heard in  the High Court within the next year.

283
00:23:04,712 --> 00:23:08,080
 But until the law is changed,  Francis condition remove his

284
00:23:08,120 --> 00:23:12,200
 solicitor as executor of his  father's will and that left him

285
00:23:12,240 --> 00:23:16,688
 angry.  It staggers belief really what some

286
00:23:16,728 --> 00:23:19,560
 companies can feel they can get  away with simply for being an

287
00:23:19,600 --> 00:23:27,844
 executor on a will.  You will agree a lot of questions

288
00:23:27,884 --> 00:23:32,704
 to be answered there and joining us  is Gary Rye-Croft.

289
00:23:32,744 --> 00:23:36,560
 When it comes to probate, it is big  business, what advice do you have

290
00:23:36,600 --> 00:23:41,236
 so people can avoid the problems we  have been watching? Probate fees

291
00:23:41,276 --> 00:23:46,768
 ought to reflect the complexity of  the will and the complexity of the

292
00:23:46,808 --> 00:23:51,236
 estate. For instance, you may have  £1 million estate, but it passes to

293
00:23:51,276 --> 00:23:55,888
 the widow and all the assets are  come priced in one bank account.

294
00:23:55,928 --> 00:24:00,188
 You wouldn't expect to pay much for  the probate fees.

295
00:24:00,228 --> 00:24:04,860
 It is confusing because there are  so many charges, you have an hourly

296
00:24:04,900 --> 00:24:09,528
 rate, you have a letter rate, you  have probate rate, where do you go

297
00:24:09,568 --> 00:24:12,956
 from there? There are different  wayss of charging. There is the

298
00:24:12,996 --> 00:24:18,064
 percentage and the hourly rate and  a fixed fee. That's something that

299
00:24:18,104 --> 00:24:22,732
 you ought to talk about with the  solicitor at the outset so the key

300
00:24:22,772 --> 00:24:26,188
 to it all is being informed. Under  our rules of conduct we have to be

301
00:24:26,228 --> 00:24:30,860
 clear about what we are going to  charge and no one should have a

302
00:24:30,900 --> 00:24:37,408
 nasty surprise.  What can people people do if they

303
00:24:37,448 --> 00:24:40,048
 think they are they are being  overcharged? There is a solicitors

304
00:24:40,088 --> 00:24:41,880
 regulation regulation authority.  There is a certain process that you

305
00:24:41,920 --> 00:24:44,832
 can go through in order to make a  complaint.

306
00:24:44,872 --> 00:24:47,968
 We have been talking about  solicitors, but when it comes to

307
00:24:48,008 --> 00:24:51,220
 the banks, are they in a similar  position? The banks have been

308
00:24:51,260 --> 00:24:54,472
 naughty in the past because they  have persuaded people to make wills

309
00:24:54,512 --> 00:24:59,752
 with them, perhaps they haven't  charged people for making wills,

310
00:24:59,792 --> 00:25:04,424
 but they made sure, they, the banks  are appointed as executors and the

311
00:25:04,464 --> 00:25:09,296
 industry average for banks is 4% or  5% for probate fees. If you have

312
00:25:09,336 --> 00:25:14,988
 got a bank executor, you will be  paying a lot in probate fees.

313
00:25:15,028 --> 00:25:20,832
 Zbli didn't realise - I didn't  realise how difficult it is to

314
00:25:20,872 --> 00:25:24,892
 remove an executor? It is difficult  because the executor named in the

315
00:25:24,932 --> 00:25:30,172
 will has the right to extract the  probate. If a family came tooz me

316
00:25:30,212 --> 00:25:34,456
 and -- to see me and said, "you are  named as an executor, but we would

317
00:25:34,496 --> 00:25:38,096
 like you to stand down." I would  think carefully.

318
00:25:38,136 --> 00:25:41,756
 Legally it is difficult to remove  the bank from the will afterwards?

319
00:25:41,796 --> 00:25:46,016
 It is difficult and banks are  reluctant to stand down because it

320
00:25:46,056 --> 00:25:50,504
 is a great money spinner for them.  When you are alive, can you remove

321
00:25:50,544 --> 00:25:55,660
 them at any time? If anyone  watching has appointed their

322
00:25:55,700 --> 00:25:59,176
 solicitor or bank as an executor,  it is open to them to make a new

323
00:25:59,216 --> 00:26:04,040
 will. As long as they have the  capacity to do so.

324
00:26:04,080 --> 00:26:08,520
 What's your final advice so people  aren't ripped-off? To talk about

325
00:26:08,560 --> 00:26:12,364
 this issue with your family ads  friends. To be -- and friends. To

326
00:26:12,404 --> 00:26:18,612
 be upfront about the fact that we  are going to die and to brief them

327
00:26:18,652 --> 00:26:22,048
 when that happens so they can go in  able to broker a deal which is fair

328
00:26:22,088 --> 00:26:25,504
 for everyone. Fair for the  solicitor and fair for the family.

329
00:26:25,544 --> 00:26:29,332
 If you feel you are not getting a  good deal, you can do something

330
00:26:29,372 --> 00:26:35,224
 about t switching credit cards,  mortgage providers or banks can

331
00:26:35,264 --> 00:26:43,992
 leave more money in your wallet,  but that's not the case with the

332
00:26:44,032 --> 00:26:49,680
 most important important financial  product you can birex annuity --

333
00:26:49,720 --> 00:26:52,724
 buy,, an annuity.  These baby boomer bikers are reving

334
00:26:52,764 --> 00:26:57,208
 up for retirement.  Nearly everyone with a private

335
00:26:57,248 --> 00:27:02,068
 pension must buy an annuity before  the age of 75.

336
00:27:02,108 --> 00:27:05,120
 Which means these guys will  handover their hard earned cash to

337
00:27:05,160 --> 00:27:09,788
 an insurance company, who will  provide a monthly income for the

338
00:27:09,828 --> 00:27:13,664
 rest of their lives. But unlike  other insurance insurance policies,

339
00:27:13,704 --> 00:27:18,520
 their stuck with it. Getting it  wrong is a costly mistake. Do they

340
00:27:18,560 --> 00:27:23,816
 know what they are getting into?  I don't know much about annuities.

341
00:27:23,856 --> 00:27:28,692
 You heard about them, but I don't  know enough to comment on them.

342
00:27:28,732 --> 00:27:32,332
 All I'm aware of, once you have got  your pension pot, you have to buy

343
00:27:32,372 --> 00:27:37,024
 an annuity and that gives you so  much per month.

344
00:27:37,064 --> 00:27:42,100
 They are like an insurance policy.  If they get it wrong, they lose and

345
00:27:42,140 --> 00:27:46,556
 if you get it wrong, you lose.  Annuities are a nice earner for

346
00:27:46,596 --> 00:27:50,616
 insurance companies. Taking the  policy offered by your current

347
00:27:50,656 --> 00:27:54,896
 pension provider could see you  robbed of a big chunk of retirement

348
00:27:54,936 --> 00:28:02,928
 income.  The whole area of annuities and how

349
00:28:02,968 --> 00:28:10,104
 you convert your pension fund into  a pension could become the next big

350
00:28:10,144 --> 00:28:16,412
 pensions misseltion scandal scandal  -- mis-sellings scandal.

351
00:28:16,452 --> 00:28:21,960
 This woman purchased an annuity  from her late husband's provider.

352
00:28:22,000 --> 00:28:28,664
 We were told we couldn't purchase  and you can't shop around and you

353
00:28:28,704 --> 00:28:33,320
 have to use us and they gave me a  fantastic pension of £38 a month.

354
00:28:33,360 --> 00:28:36,996
 It must cost more to admin straight  than to give me a pension. If I

355
00:28:37,036 --> 00:28:41,244
 shopped around I could have doubled  the amount I get.

356
00:28:41,284 --> 00:28:46,336
 A recent investigation by the FSA  revealed that many companies failed

357
00:28:46,376 --> 00:28:49,568
 to tell their customers they had  the option to shop around for a

358
00:28:49,608 --> 00:28:53,040
 better annuity.  300,000 people a year lose out by

359
00:28:53,080 --> 00:28:57,088
 not taking their pension pot  elsewhere.

360
00:28:57,128 --> 00:29:01,964
 These companies are still taking a  big slice in commission.

361
00:29:02,004 --> 00:29:08,872
 If you have a £20,000 pension fund,  then the insurance company will

362
00:29:08,912 --> 00:29:12,324
 take away between £200 and £300 of  that before you get annuity for

363
00:29:12,364 --> 00:29:19,288
 doing nothing.  Later, our bikers will find out how

364
00:29:19,328 --> 00:29:22,760
 they can avoid taking a wrong turn  Payment protection insurance

365
00:29:22,800 --> 00:29:25,792
 generates billions of pounds for  the finance industry every year.

366
00:29:25,832 --> 00:29:43,000
 Thousands of people have been left  high and dry when they come to

367
00:29:43,040 --> 00:29:47,528
 claim on it. Leading to accusations  Payment protection insurance or PPI

368
00:29:47,568 --> 00:29:52,728
 is designed to cover your loans and  credit card payments if you end up

369
00:29:52,768 --> 00:29:59,248
 ill or unemployed. Since being  introduced it caused controversy.

370
00:29:59,288 --> 00:30:03,512
 Many people claim it is being mis-  sold to them, others have received

371
00:30:03,552 --> 00:30:09,184
 a nasty surprise after signing on  the dotted line.

372
00:30:09,224 --> 00:30:13,448
 Paying £18,000 for PPI on top of a  loan of over £70,000, Stephen

373
00:30:13,488 --> 00:30:17,120
 doesn't think the cost was fully  explained to him by his lenders.

374
00:30:17,160 --> 00:30:24,448
 I thought the PPI would be a  separate payment, independent of

375
00:30:24,488 --> 00:30:30,136
 the payments that I was making for  my loan, but it trance transpires

376
00:30:30,176 --> 00:30:35,028
 they added the PPI payment on to my  loan which bumped the price up.

377
00:30:35,068 --> 00:30:38,264
 Although he was made redundant, he  doesn't want to make a claim as his

378
00:30:38,304 --> 00:30:43,764
 policy has a cash back incentive  attached. Stephen thinks if he

379
00:30:43,804 --> 00:30:49,436
 makes a claim, he will lose the  cash back entitlement of the policy.

380
00:30:49,476 --> 00:30:54,312
 I was led to leave after the five  year period I would get possibly

381
00:30:54,352 --> 00:31:03,236
 £18,000 back which is a  considerable amount of the PPI that

382
00:31:03,276 --> 00:31:09,732
 I have been paying in. If I make a  claim to have the PPI instigated

383
00:31:09,772 --> 00:31:17,748
 before that five year period is up,  I would lose any lump sum returns.

384
00:31:17,788 --> 00:31:20,576
 But according to financial claims  expert Karl Wright, the cash back

385
00:31:20,616 --> 00:31:24,640
 incentives are not worth the paper  they are written on.

386
00:31:24,680 --> 00:31:28,704
 They are a gimmick and not the  reality. If nobody actually is able

387
00:31:28,744 --> 00:31:33,168
 to benefit from that carrot really  and truly the sales practises of

388
00:31:33,208 --> 00:31:36,624
 the banks and credit card companies  should be called into question.

389
00:31:36,664 --> 00:31:40,496
 The Competition Commission has been  questioning PPIs and this year they

390
00:31:40,536 --> 00:31:44,764
 raised the possibility of banning  lenders from selling the insurance

391
00:31:44,804 --> 00:31:48,408
 when a loan is agreed or for seven  days afterwards.

392
00:31:48,448 --> 00:31:51,656
 It is an initiative that the  Citizens Advice Bureau would

393
00:31:51,696 --> 00:31:57,780
 welcome.  Products can be complicated so

394
00:31:57,820 --> 00:32:01,440
 there are lots of exclusion clauses  and small print, people selling it

395
00:32:01,480 --> 00:32:04,876
 may not be explaining it well to  them and when they recommend it,

396
00:32:04,916 --> 00:32:10,328
 maybe recommending policies that  aren't good for them. People have

397
00:32:10,368 --> 00:32:13,888
 ended up with PPI they weren't  aware they were buying and we have

398
00:32:13,928 --> 00:32:17,956
 seen cases of people didn't say  they wanted.

399
00:32:17,996 --> 00:32:21,800
 If you have taken out a loan, check  and see if you are paying for PPII

400
00:32:21,840 --> 00:32:26,080
 if you are and didn't know or if  you think you are overpaying, write

401
00:32:26,120 --> 00:32:30,144
 to your lender to explain your  concerns. If you are unhappy with

402
00:32:30,184 --> 00:32:35,424
 the response, get in contact with  the Financial Ombudsman. This year

403
00:32:35,464 --> 00:32:40,296
 alone they have held nearly 80% of  complaints regarding PPI.

404
00:32:40,336 --> 00:32:45,580
 With banks desperate for our custom,  we are being wooed with perks and

405
00:32:45,620 --> 00:32:49,424
 and extras. This is known through a  packaged account. Believe it or not

406
00:32:49,464 --> 00:33:03,248
 eight million of us signed up to  one. We want to know if they are

407
00:33:03,288 --> 00:33:08,396
 Packaged accounts combine a current  account with certainly benefits. So

408
00:33:08,436 --> 00:33:12,408
 as well as looking after your hard  earned cash, you also get travel

409
00:33:12,448 --> 00:33:17,360
 insurance, or car breakdown cover,  but like always there is a fee and

410
00:33:17,400 --> 00:33:24,268
 often a catch.  I took out a package account last

411
00:33:24,308 --> 00:33:29,768
 year because I needed travel  insurance, but when travelling to

412
00:33:29,808 --> 00:33:34,848
 Africa and rang up the travel  insurance company and surprise,

413
00:33:34,888 --> 00:33:38,096
 surprise Africa was excluded.  Joanna found out the hard way that

414
00:33:38,136 --> 00:33:44,848
 the benefits offered are not always  what they they seem when you sign

415
00:33:44,888 --> 00:33:48,520
 Most of the benefits offered  through a package account are

416
00:33:48,560 --> 00:33:54,192
 uselessment take commission based  currency for example, anyone can

417
00:33:54,232 --> 00:33:59,096
 walk into the Post Office and get  that. You have identity theft cover

418
00:33:59,136 --> 00:34:04,192
 which we all get under the Banking  Code.

419
00:34:04,232 --> 00:34:06,424
 A poll carried out found that 88%  of respondants thought package

420
00:34:06,464 --> 00:34:10,680
 accounts weren't worth the money  charged.

421
00:34:10,720 --> 00:34:15,972
 It is really, really hard to  compare products on a like for like

422
00:34:16,012 --> 00:34:23,880
 basis.  We did a little digging. We looked

423
00:34:23,920 --> 00:34:37,660
 at five packaged accounts and tried  to buy the three. Buy shopping

424
00:34:37,700 --> 00:34:48,144
 around, you can get services for  £11.50, while the package comes to

425
00:34:48,184 --> 00:34:55,456
 £17.70, but adds up to up over £20  a month.

426
00:34:55,496 --> 00:34:58,708
 Are you confused? Well, quite a few  of you are. 40% of you told our

427
00:34:58,748 --> 00:35:02,768
 surveyers that you think our  savings are less safe in the bank

428
00:35:02,808 --> 00:35:07,040
 than five years ago.  Back to annuities and how to ensure

429
00:35:07,080 --> 00:35:12,148
 you can get the most out of pension  pot. Here is what you need to know

430
00:35:12,188 --> 00:35:16,400
 before you sign on the dotteded  line. -- dotted line.

431
00:35:16,440 --> 00:35:23,916
 We saw how choosing the wrong  annuity could result in a poor

432
00:35:23,956 --> 00:35:29,196
 pension income. They gave me a  fantastic pension of £38 a month.

433
00:35:29,236 --> 00:35:34,480
 These baby boomer bikers are on the  road to retirement. If they don't

434
00:35:34,520 --> 00:35:39,352
 buy the best annuity they could see  their finances crash and burn.

435
00:35:39,392 --> 00:35:43,008
 Independent financial adviser,  Olivia is here to point them in the

436
00:35:43,048 --> 00:35:46,868
 right direction.  One the mistakes people make is

437
00:35:46,908 --> 00:35:51,944
 taking the quote their pension  provider issues and not shopping

438
00:35:51,984 --> 00:35:54,384
 around. It may not be the most  suitable type of annuity for them

439
00:35:54,424 --> 00:35:59,256
 and it may not be the most  competitive.

440
00:35:59,296 --> 00:36:03,728
 If you don't want pension providers  to profit from your ignorance, here

441
00:36:03,768 --> 00:36:08,804
 is what you need to know.  If you want to increase your

442
00:36:08,844 --> 00:36:13,680
 annuity in line with inflation, you  can do that. At the moment

443
00:36:13,720 --> 00:36:19,976
 inflation is low, but there is no  guarantee it will remain low.

444
00:36:20,016 --> 00:36:23,448
 As you may have an annuity for ten,  20, or 30 years, you need to decide

445
00:36:23,488 --> 00:36:29,336
 if you want it to grow with  inflation.

446
00:36:29,376 --> 00:36:32,792
 If you do inflation-proof your  income, you would look to lose 30%

447
00:36:32,832 --> 00:36:36,648
 initially and over time you would  make that up.

448
00:36:36,688 --> 00:36:39,900
 Health issues can significantly  boost your annuity income. If the

449
00:36:39,940 --> 00:36:44,448
 insurance company doesn't think you  will live long, it will pay you

450
00:36:44,488 --> 00:36:48,104
 more each year.  Because I have been overweight,

451
00:36:48,144 --> 00:36:51,152
 buying life insurance, it has  always been against me. With having

452
00:36:51,192 --> 00:36:56,228
 an annuity, will that make it the  opposite effect.

453
00:36:56,268 --> 00:36:59,680
 That could work, yes.  You have to be obese though to get.

454
00:36:59,720 --> 00:37:05,212
 I am obese.  Are you? Yes.

455
00:37:05,252 --> 00:37:09,884
 Many people have fallen foul of  annuity providers, leaving their

456
00:37:09,924 --> 00:37:15,776
 families with nothing after their  death. Don't Forget to mention this

457
00:37:15,816 --> 00:37:23,324
 if you are married.  We recommend that you consider a

458
00:37:23,364 --> 00:37:26,744
 spouse's annuity so that if you  were to predesees her, her annuity

459
00:37:26,784 --> 00:37:30,436
 income doesn't disappear.  For Martin, Olivia has beaten the

460
00:37:30,476 --> 00:37:36,324
 annuity offer from his current  pension provider.

461
00:37:36,364 --> 00:37:42,212
 I found that you could get about  13% more as an annual income by

462
00:37:42,252 --> 00:37:46,888
 shopping around.  It is a substantial increase.

463
00:37:46,928 --> 00:37:51,560
 She gave me an indication that she  could get me a better percentage

464
00:37:51,600 --> 00:37:54,604
 that I was getting at the moment.  If she got that in the time she had

465
00:37:54,644 --> 00:37:57,044
 available and it is worth looking  around to see if I can do anything

466
00:37:57,084 --> 00:38:04,104
 better.  For a better chance of a bigger

467
00:38:04,144 --> 00:38:07,360
 annuity, don't take the first one  By shopping around and not

468
00:38:07,400 --> 00:38:12,028
 accepting the first offer from your  pension provider, you will get the

469
00:38:12,068 --> 00:38:14,872
 best deal. Well, to find out more  about this, I am joined by Ben

470
00:38:14,912 --> 00:38:19,120
 Stafford from the Association of  British Insurers.

471
00:38:19,160 --> 00:38:24,248
 There is a lot of confusion about  annuities and I am tempted to say

472
00:38:24,288 --> 00:38:27,888
 that insurance insurance companies  are trading on pim's ig -- people's

473
00:38:27,928 --> 00:38:32,360
 ignorance? We have done a lot of  work in the last 18 months that's

474
00:38:32,400 --> 00:38:35,608
 been intended to up the game in  terms of what customers can expect.

475
00:38:35,648 --> 00:38:42,108
 There are financial capability  issues and not everybody is

476
00:38:42,148 --> 00:38:46,576
 familiar with the terms that you  mention now. An annuity, what is it,

477
00:38:46,616 --> 00:38:49,824
 do I need one? Many people will. We  are conscious we need to make sure

478
00:38:49,864 --> 00:38:53,888
 we communicate in a way that's  short and gets the message across

479
00:38:53,928 --> 00:38:56,124
 in a way that people understand.  Your members were criticised a

480
00:38:56,164 --> 00:39:01,404
 couple of years ago by the  Financial Services Authority

481
00:39:01,444 --> 00:39:06,292
 because they said two out of five  pension providers weren't telling

482
00:39:06,332 --> 00:39:09,184
 them that they could shop around?  Yes, the criticism was they weren't

483
00:39:09,224 --> 00:39:14,216
 being clear about the open market  option rather than not mentioning

484
00:39:14,256 --> 00:39:17,876
 it. The open market option is good  news for consumers. When you retire,

485
00:39:17,916 --> 00:39:22,344
 you need to make sure you make the  most of the pension funds you built

486
00:39:22,384 --> 00:39:31,344
 up and the key way to do that is  use the open market option. It is

487
00:39:31,384 --> 00:39:35,808
 the annuity type. The open market  system is an option.

488
00:39:35,848 --> 00:39:41,904
 You can shop around. How do you do  that? What's the process, is there

489
00:39:41,944 --> 00:39:45,560
 a time frame? Depending on the type  of pension, four to six months

490
00:39:45,600 --> 00:39:50,560
 prior to retirement you will get  the wake-up pack. There will be a

491
00:39:50,600 --> 00:39:54,732
 letter which explains why you have  got the pack and what you need to

492
00:39:54,772 --> 00:40:00,844
 do and a brochure from the provider  explaining what the different

493
00:40:00,884 --> 00:40:04,904
 options are. After that, at around  six weeks prior to pretirem, the --

494
00:40:04,944 --> 00:40:07,752
 pretiremt, the provider will send  on a quote or remind you there are

495
00:40:07,792 --> 00:40:12,216
 options to move on to a different  provider.

496
00:40:12,256 --> 00:40:19,140
 What can you say to someone who has  got their annuity and thinks, "I

497
00:40:19,180 --> 00:40:26,248
 should have shopped around." What  can they do? Well, an annuity has a

498
00:40:26,288 --> 00:40:29,500
 short cooling off period. An  annuity is an irreversible purchase

499
00:40:29,540 --> 00:40:33,160
 decision. It is important you shop  around. It is not like other

500
00:40:33,200 --> 00:40:37,828
 products where you can come out of  it easily and get a refund. It is

501
00:40:37,868 --> 00:40:41,688
 critical you look at the right type  of annuity, look at the best rate

502
00:40:41,728 --> 00:40:46,784
 and proceed on that basis.  After all we have heard today, the

503
00:40:46,824 --> 00:40:52,064
 final result from our independent  nationwide survey is the most

504
00:40:52,104 --> 00:40:56,360
 surprising. Majority Of you, 87%,  told us that you are happy with the

505
00:40:56,400 --> 00:40:59,812
 service you are getting from your  bank.

506
00:40:59,852 --> 00:41:03,064
 The most important thing to  remember when it comes to financial

507
00:41:03,104 --> 00:41:06,720
 decisions is do your research.  Always, always read the small print

508
00:41:06,760 --> 00:41:09,768
 and see what else is out there  before you sign up.

509
00:41:09,808 --> 00:41:15,048
 Most financial products have a  cooling off period so if you have

510
00:41:15,088 --> 00:41:18,908
 signed up to something, you can  always change your mind. Don't be

511
00:41:18,948 --> 00:41:23,172
 afraid to say no.  These it from Rip-Off Britain for

512
00:41:23,212 --> 00:41:25,812
 today. We will be back tomorrow at  the same time for more rip-offs and

513
00:41:25,852 --> 00:41:28,520
 advice. We hope you can join us  then.

514
00:41:28,560 --> 00:41:32,784
 Next time, we will be looking at  the high street and your weekly

515
00:41:32,824 --> 00:41:36,376
 shop.  I do feel cheated when I'm paying

516
00:41:36,416 --> 00:41:40,036
 the same amount of money, but not  getting the same amount of product.

517
00:41:40,076 --> 00:41:43,488
 From the supermarkets who charge  you overthe odds depending on where