Savers with Icesave who have had their accounts frozen may be “pleased” to find out that their compensation payment is set to be sorted out by 30th November 2008.
The Government has said that every UK Icesave saver will get their money back in full, and the majority of this should be paid by the end of November.
Whilst it’s good to see some movement on this issue, the way the compensation is to be processed leaves me with a few concerns.
Compensation Process
The Financial Services Compensation Scheme will be sending out emails over the next few days to the 230,000 Icesave customers.
Not only does this leave some people open to phishing attacks – I can imagine there are a few email spammers busy getting ready to send out fake emails from the FSCS as we speak – but also email can be a little unreliable at times, with spam filters filtering valid emails and the like, which could leave a few savers without the necessary information to continue their claim. I would have thought a safer way to deal with this would be to initiate it by post (which I’m aware has its own problems).
Other than those concerns, at least it appears that most customers will get their money back within a reasonable timescale, given that the accounts were closed on 8th October. The FSCS aims to payout within 3 months, so this is well within that. Once they’ve submitted their claim, the money should be transfered to a chosen bank account in 2 or 3 days.
ISA Status & Interest
For ISA savers, the Treasury has said that their savings will not lose the ISA tax status. For those with normal savings accounts, interest will only be paid up to 8th October, when Icesave went bust. Those with fixed rate bonds will have the option to either wait for them to mature and then receive the interest due up until the maturity date or to cash them in, although it’s not clear whether those who decide to cash them in will lose any interest.
I’d be interested in hearing the thoughts of any Icesave savers on this process, and also let us know how you get on reclaiming your money. Please leave your thoughts in the comments below, but don’t include any sensitive data.
I have a two year fixed rate bond with Icesave. If I decide to leave the money invested for the remaining 1 year & 4 months, who will my money be invested with – IMG (who now have my 1 year ex-Kaupthing Edge bond)or a UK bank/building society?
I phoned the FSCS, but all they would say was that all will be made clear in their email.