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Wednesday, March 31, 2010

The Great ISA Rip Off

The Times reports that the Isa tax break created by Gordon Brown to encourage people to save has turned into a £3BN a year rip-off operated by the banks.

That at least is the conclusion of Consumer Focus (CF), a consumer watchdog.

Consumer Focus has made a formal complaint to the Office of Fair Trading (OFT)alleging that cash Isas pay derisory rates of interest and that banks use unfair obstacles to stop people from switching to better deals.

Mike O'Connor, CEO of Consumer Focus, is quoted:

"It beggars belief that in 21st century Britain it takes a month to transfer information and funds from one bank to another.

The average Isa saver is getting a poor deal
."

It estimates that cash Isa savers are being denied between £1.5BN and £3BN.

It is hardly surprising that people do not trust the banks.

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