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Saturday, 31 July 2010

Thieving bankers

The Telegraph reveals this morning how the thieving bankers are skimming billions from our savings in immoral and hidden deductions.

I fear only a return to mediaeval justice will have any effect on these sorry creatures; once we amputate the hands of a few Investment Managers and slit open the nostrils of a few more dodgy Fund Managers then their love of filling their mouths with our gold may become somewhat diminished.


Weekend Yachtsman said...

Never mind the bankers, what about the State skimming billions from our savings by debauching the currency?

Last I checked, inflation was 5% and the interest rate on my savings account was 0.1%.

It's not exactly a hidden deduction, but it sure is immoral and thieving.

Stuart said...

the telegraph story is a bit of a canard. it is certainly not new news.

It has been an issue since I started in finance in 2003. The issue, such as it is, tends to be in legacy products sold within insurance wrappers.

However I feel this firmly stays within the realm of caveat emptor. You wouldn't buy a car without doing some price research, surely the same principle applies to investments.

Finally about 50% of the ongoing charges revert to the IFA as trail commission. Once the retail distribution review from the FSA comes into full effect the trail commission will no longer be allowed. This should eliminate afair amount of the unfair fees.

strawbrick said...

It is not just investment funds, it is also banks who act executors / trustees, let us call them MegaBank Trustees Ltd. They will charge a stated percentage fee based on the value of the fund they are managing on the same day each year. However, they do not take the money to pay themselves this annual fee from any cash deposits they may be holding at the time, rather they will sell some of the assets (usually shares or guilts) to raise the funds. This will normally be done through their associated company, MegaBank Brokers Ltd, who of course charge an undisclosed fee! Further, should MegaBank Trustees decide to change any of the investments, selling one share and buying another, then MegaBank Brokers are in for more fees! It gets worse, instructions for buying and selling are often "outside" the scope of the stated percentage fee and MegaBank raises more charges (for which it must give instructions to sell more shares).

Demetrius said...

How very Eastern. Burning at the stake, beheading and hanging and quartering were always good enough for my ancestors. Female counterfeiters went to the stake until the end of the 18th Century.

English Pensioner said...

Which explains why, if I live about another 10 years, I will be able (and need to) to claim support from the state, whereas if my investments hadn't been been skimmed off by bankers and inflation, I might have remained self sufficient

Jackart said...

Of course you could find an investment manager who doesn't skim obscene fees and invoices you for what he does charge...