Woolwich Sucks .co .uk - the condemned building society
Under major reconstruction
This site is about the Great Endowment Scandal, perpetrated on the UK public.
I believe everybody that got an endowment mortgage was "mis-sold" - well, worse than that actually.
Please allow me to explain why. You probably will not believe what I have to tell you - it involves the Financial Services Authority and the Serious Fraud Office both being rather 'evasive' (to say the least).
Firstly - hello, my name is Garry Anderson. I am married with two daughters and live in Haverhill, Suffolk. My personal site is skilful.com. If you think any argument illogical, please explain why: firstname.lastname@example.org.
I hereby declare this all to be a truthful - to the best of my knowledge. It also has my opinion of the people involved - which is as objective as I can make it. I regard myself as person of average education and good intelligence. Somebody not easily taken in - or so I thought. The scans of text and graphics on this page are all cut and paste from my building society documents - which can be seen in the following links.
Most of you were fed with charts and figures to show how well you would have done in the past - implying you would have to be really very stupid not to put into it now.
Some building societies even tell you these charts do not show future performance - your investment could do slightly better or worse. If they are not indicative of future performance - why the blinking heck show them?
Look at these charts - and given a 19% average growth figure - you would be an absolute mug not to get an endowment - wouldn't you?
Before we go any further - the definition of Fraud, from the Oxford English Dictionary:
FRAUD: Criminal deception; the using of false representations to obtain an unjust advantage or to injure the rights or interests of another.
Better yet - a quote from HM Government Treasury - how they describe FRAUD:
What is fraud?
No precise legal definition of fraud exists; many
of the offences referred to as fraud are
For practical purposes fraud may be defined as
the use of deception with the intention
Isn't "mis-selling" the same as false representation for gain - fraud - why then no criminal charges?
These experts knew the market would not stay as it was for 25 years - didn't they?
If somebody takes money from you hiding true risk - basic deception - why is that not fraud?
Most warning was totally inadequate - like being told it is safe to jump off a twenty-five storey building while wearing only a crash helmet. Why did they not warn of the real risks - and tell about "churning"?
"Churning" is a scam - I was "churned" out of many
thousands of pounds.
The endowment was sold to you as an investment that would grow to pay off your mortgage - not as a gamble which could lose all the twenty-five years payments you made - and then would still leave you having to pay for your house at the end of it - or lose that also.
Yes - you could lose all twenty-five years endowment payments - and your house.
Everybody with endowment mortgage was "mis-sold" it - or "defrauded" to give correct term.
They hide the distinction. Fact: You get a mortgage to REPAY your loan. Repayment mortgage does this, it is fit for this purpose. Endowment is a nothing but a GAMBLE in the HOPE of repaying loan - you could lose big time - all your payments and home.
The Financial Services Authority seems to think an endowment is a "savings scheme" - when it is clearly a "gambling scheme".
Your "horse" could stumble, never to make up ground - this could happen any number of times during the very long twenty five year race. Worse, it could fall and break a leg - having to be shot. To those people contacted at Financial Services Authority - the "horse" is policy OR market.
A "savings scheme" - like doubling up on red at roulette until you have enough to repay loan.
Objectively: Is endowment a "suitable product" (fit for purpose) with the most important and imperative aim of repaying your very large loan, when a deep market recession or crash could take it out, along with your pension and investments?
The Financial Services Authority seems to think it a "suitable product" that is "fit for purpose".
At least with repayment scheme, money is coming off the balance all the time. Can somebody please tell me why are the FSA not aiding and abetting in this?
You were "mis-sold" endowment mortgage because it was not "fit for purpose".
You were told it should be safe to jump off twenty-five storey building - instead of being told to walk down the flights of stairs. Endowments are NOT the magic elevator or escalator that they made them out to be.
In 1986 I was one of many that got a letter from the management of my building society (pre-Gateway & Woolwich merger) about swapping from repayment to endowment mortgage. Like my bank, I expected them to be honest and to truthfully inform me of any risks. It did not - it was quite the opposite - a glowing endorsement that spoke only of advantages - see for yourself. Please show me where it says you could lose all your payments and house - or where it explains how they will "churn" you out of nearly all the money you have paid so far.
The letter also contained a brochure explaining the plan. Again, please show me where it says you could lose your payments and house or explains "churning". They said only conservative performance required to meet the target and named the individual members of the award winning investment team. Showing wads of money and only two possible outcomes - finish years early OR a cash sum.
I have been in touch with the Financial Services Authority (FSA), about what most rather euphemistically call "mis-selling".
They have been most evassive and refuse to tell me why I have not been defrauded.
I made complaint against FSA for "lack of integrity" - it was upheld. But still they refuse to answer.
The Serious Fraud Office will not tell me either.
Can you guess why the FSA and SFO would conceal fraud? - Isn't this perverting the course of Justice?
The FSA say that churning is the proscribed practice which "results in the consumer suffering two sets of charges and hence consumer detriment." The effect of churning is FAR WORSE than this for endowments. MOST of the money paid in the early years of the repayment mortgage is taken in charges and interest. Consumer detriment could hardly be any worse - could it (anybody at FSA)?
My building society actually quoted a cash sum that I would get at the end of loan term. I did not know all this at the time, but it was less than the money they had "churned" from me in charges and interest from my previous repayment mortgage with them. Of course, with inflation, this money would be worth a lot less in twenty five years time. This loss was actual - my gain was illusory. The building societies gain was all actual. The building society did not tell their customers about this money - it is a double fraud to these customers.
If a similar thing happened to you, have you ever thought the reason you feel conned (like me), is that you have been? This is why I feel so outraged now - enough to get this site going. Like most people I was naive to trust them. Yes, okay, I was stupid - thinking BOTH the lenders and myself would gain out of this method. Everybody can be conned - it is clear they played on peoples thoughts to save money.
How wrong I was, thinking BOTH the lenders and borrowers would gain. The lenders were gambling with our money - they could only gain from it - we could lose it all. It is a con - pure and simple.
The people who took out endowment mortgages were not trying to get something for nothing - nor were they after easy money. These people were trying to save money on their most expensive life purchase. They thought they would get back a few thousand pounds - out of the very many thousands of pounds the mortgage lenders took from them in profits.
Everybody was told it was a SPECIAL kind of mortgage. We were ALL told that we would either pay years early OR get wads of money at the end. Not one person in the UK - as far as I know - was told that they could lose everything - all their payments and family home.
Can anybody say these facts are wrong?
Fact 1. Many people were told they would have to pay thousands - to increase their payments to make up for a 'predicted' shortfall in Endowment Mortgage. This is very bad financial advice - like being told to gamble more money on a losing horse.
Fact 2. Although paying thousands of pounds extra for the shortfall
- this does not protect them. They could lose all that extra money on
top. The stock market could still have a big fall or crash - losing all
Is it GOOD FINANCIAL ADVICE to make GAMBLE to repay biggest loan you are likely ever to make?
That is basically why I believe those that took out endowment have been defrauded. This fraud is ongoing. The FSA and SFO are involved in covering this up.
One person emailed, "It was the poor stockmarket that was the problem which no one foresaw."
Well it is true that nobody can forsee when any problem will come to the stockmarket - but is a lie to say that financial market do not know that these problems arise.
It is my informed opinion that any of these financial experts saying they did not know about big drops in the market or crashes and the consequences is a liar. Also the possibility that the entire industry has been financial incompetent to remain silent for all these years is too incredible to believe.
Fact: the level of risk in this gamble is unknown - nobody can say when problems may occur.
Ask any one of these financial experts on the witness stand, "EVEN IF a couple might think it is good idea to take out an endowment, a VERY LARGE LOAN (years of their joint salary), though they know it a gamble - when is it ever GOOD FINANCIAL ADVICE to say they should go ahead with a GAMBLE TO REPAY THE LARGEST OF LOAN?"
Surely, the honest answer is "NEVER"?
Fact: Endowment Policy is a gamble - therefore is not fit for use of repaying largest of loans - we were conned.
The authorities would like to sweep it all under the carpet - like it was some great big mistake.
They want settlements, putting a small portion of people back in the position they would have been in.
This is letting guilty get away with fraud - to give false confidence in the market and let others be conned.
By accepting settlement, it is like saying to house burglar - "Well give us our things back and we will not say any more about it - you did not mean to take them".
You should also be given damages and they should be punished.
Is it also not fact - FSA fines get paid by customers and investors - guilty fat-cat directors can award themselves big pay rise to make up any shortfall?
There is lots more to tell - come back soon.