Scottish Widows U-turns after its ‘no Isas for the elderly’ policy is queried

First published in The Herald on 5 October 2019

EDINBURGH financial services firm Scottish Widows has back-tracked on a claim that it does not offer stocks and shares Isas to anyone over the age of 74, telling a potential customer he had been given the wrong information when his attempt to invest with the business was refused.

Retired engineering lecturer Bob McFarlane, who is 76, had tried to open an investment Isa with Scottish Widows, which is owned by Lloyds Banking Group, in August, but said he was refused when the person handling his call was told his date of birth.

“I had a cash Isa which was maturing in August,” Mr McFarlane explained.

“I could have put it back in for 0.6 per cent interest but I used to have an investment Isa with Scottish Widows so I phoned them and told them I was interested in a stocks and shares Isa.

“They said that’s okay and took my details but when my date of birth came up they said ‘we can’t do business with you because you’re over 74’.”

When Mr McFarlane complained to Scottish Widows it confirmed its stance in writing, telling him that “the maximum age of entry for our stocks and shares Isa is 74”.

After details of the letter were published in The Herald, however, Scottish Widows re-contacted Mr McFarlane to tell him he had been given “incorrect information in regards to taking out a new stocks and shares Isa with Scottish Widows”.

In a letter, complaint manager Jenny Vincent said that “having fully reviewed this matter, it is clear that we have not provided you with an acceptable level of service and your complaint has been upheld”.

“I am so sorry that we led you to believe that an age restriction was linked to this product and for how this would have made you feel,” Ms Vincent wrote.

“The product itself does not have an age restriction, however we are only able to offer advice and proceed with telephony applications for customers under the age of 74.

“We should have explained this to you previously and also made you aware that you could seek independent financial advice in order to take out the new policy with us.”

This is not the first time Scottish Widows has had to apologise for members of its customer services department incorrectly claiming there is an upper age limit on its investment Isas.

In 2014, a reader of The Guardian contacted that newspaper’s Your Problems section asking it to investigate why, when she had attempted to buy a Scottish Widows Isa via fellow Lloyds subsidiary Halifax, “to my astonishment I was told I could not have one as I was over 74”.

The company told the paper at the time that the claim had been “made up” by an employee, adding that it would “raise this mistake” to “ensure it doesn’t happen again”.

It also made a payment of £1,850 to the complainant to cover the tax advantages she lost by missing the tax-year investment deadline and to compensate her for any stress caused.

The business has also compensated Mr McFarlane, sending him a cheque for £100 in recognition, it said, of the fact he had not been provided with “an acceptable level of service”.

It has also sent him a pack containing details of the various investments he could make within its Isa wrapper, though stressed that this is not normal practice.

“This is outwith our normal process and is the documentation that we would send to customers under age 74 who contact us by telephone,” Ms Vincent wrote.

“To clarify, we have provided you with incorrect information in confirming that the maximum age of entry into our stocks and shares Isa is 74.

“Whilst we would not have been able to offer you advice or send you the information in writing on verbal request, we should have explained to you that the product was available through seeking independent financial advice.

“We have made a concession on this occasion to provide you with the paperwork, given the poor service you have received and the incorrect information you have received.”

Mr McFarlane, who initially chose to keep his money in a low-interest cash Isa from Bank of Scotland, which is also owned by Lloyds, said he is still considering whether to invest his money with Scottish Widows.

He said he will donate the £100 compensation money to charity.

In a statement, a spokesperson for Scottish Widows said: “We’re sorry for the service Mr McFarlane received. This is an important decision, particularly for potentially vulnerable customers.

“We should have explained that the investment product he was looking for was only available with financial advice.”