As you may be aware from our previous emails, we have recently noticed an increase in fraudsters pretending to be customers and requesting withdrawals from investments. As a result we have carried out a review of our money-out controls to ensure we play our part in protecting the interests of your clients.
We have also created a new video that demonstrates how these frauds are often perpetrated and what you can do to prevent them.
What changes are we making?
We are introducing the following changes for all products. We will be making these changes in phases. Due to the new pension freedoms, the first phase started with money-out requests for pensions from 7 April and will be rolled out to ISAs, Collective Investment Accounts and Collective Investment Bonds from 11 May. For all other products you will see the changes to our process within the next few months.
- If your client is requesting payment to a new bank account, we need proof that the bank account belongs to your client before we can proceed. See below for more information.
To collect this information up-front, our money-out forms have been updated to request evidence of bank account ownership regardless of the amount being withdrawn. (Previously this was only requested for payments of over £150,000).
- If a request is unclear or incomplete, we won’t process the disinvestment until all information is received.
To avoid confusion and/or any disadvantage to your client in the case of a fraudulent request, we will not action any trades or disinvestments as part of a money-out request until we receive the relevant full-completed form (or a clear and unambiguous written request) and all necessary supporting documentation, including proof of bank account ownership.
- We are reducing payment timeframes.
From 7 April all money-out instructions that request payment via BACS (directly to the bank) will be issued two working days earlier than they are now. This means they will be paid within the same timescale as a CHAPS payment but without the additional fee.
What do we mean by a new bank account?
By new, we mean new to us. In other words:
the bank account specified to receive the payment has not previously been used to make payments to us, or
the same bank details are not being used for a longstanding (over 6 months) Direct Debit or regular/income withdrawal arrangement with us.
What will we accept as proof of bank account ownership?
Evidence can be any one of the following:
An original voided cheque (or a certified* copy)
An original bank statement (or a certified* copy) dated within the last 6 months
A printed and certified* online bank statement which must include the following information:
- account number
- sort code
- client’s name
- date of the statement.
We only need this evidence once (unless the client requests payment to a different account in future) as we will keep it on our records.
Clients can still receive payment by cheque to their home address, for which no proof of bank account is required.
Top tips for avoiding delays in payment
If you are unsure of what to send with a money-out request, if you provide the following information it will typically cater for the majority of cases:
Proof of the client’s residential address if it has changed within the last 12 months, for example an original household bill dated within the last 6 months (mobile phone bills are not acceptable).
Proof of bank account ownership. (Please see above).
Signature validation - where we do not hold a record of the client’s signature from a new business/top up application or adviser fee form, we will require evidence of the client’s signature, for example a current Driving Licence or Passport (certified* copies will be accepted).
Proof of identification (where not already supplied) for individuals who have been added since the product was set up, such as attorneys or trustees.
*Certified by a financial adviser, bank manager, solicitor or accountant.