Should I accept HSBC's PEP offer?

By THIS IS MONEY
Updated:

 

I have received an unsolicited offer of compensation from HSBC for a Fixed Income PEP, taken out by my now deceased mother in 1999.

Apparently the amount invested exceeded HSBCs guidelines 'without justification', though as far as I can see the amount invested of £6,000 fell squarely within the range permitted by HSBC.

I am concerned that the true reason why compensation is being offered is because at the time of the investment my mother was a pensioner and thus the cardinal rule that the elderly should not invest in equities was broken. Should I query the offer or take the money, which is £2,500? JD, Didcot

Mike Pendergast, independent financial adviser, with Zen Financial Services, said: 'This depends on the reason for the compensation offer. I wouldn't think it would be due to your latter comment, as there is nothing to stop the elderly investing in equities as long as they know the risks and their personal situation has been fully assessed and analysed.

It is more likely to be something to do with the fund managers remit and whether they stayed within the guidelines of the fund, and nothing to do with the £6,000 invested – as you say this was within the PEP limits at the time.

HSBC will have calculated the compensation inline with FSA guidance, so my gut reaction would be to accept what they are offering – however you could take the case to the Financial Ombudsman for a second opinion – see www.financial-ombudsman.org.uk.

Most watched Money videos