Are you stuck in one of Britain's worst investments?

Imagine paying diligently into an endowment or a pension for nearly ten years. The stock market is up about 20% over the same period, so you expect your policy to provide healthy returns. Instead, you discover that on maturity your plan will be, at worst, worth less than your contributions and, at best, worth less than if you had stuck it in cash.

This is precisely what happened to Peter Carter, 50, a retired businessman from Chalfont St Peter in Buckinghamshire. He was disgusted when he received this year’s statement from Friends Provident. It informed him that his two with-profits investments, taken out for his children in 1999, would be worth £22,800 at maturity in two years’ time, even though he would have contributed a total of £24,000.
His own million-pound portfolio had jumped 60% since 1999 and the stock market was up 20%. He also owns a portfolio of Friends Provident shares, which were up 40%.
“How is it that a private investor with no advice from a third party who picked stocks basically at random in his spare time can so massively outpeform the supposed gurus at Friends Provident,” he said.
When he called his insurer, he was told that he would be “lucky” to get £25,200 back if it decided to add a final bonus at maturity — equivalent to 0.96% a year — although he was told there were no guarantees.
“Like many people in my situation, I was taken in by claims that the professionals would make money for me, but I might as well have put my cash under the mattress or in a building society,” he said.
He decided to bite the bullet and cancel the policy, getting back £16,224 compared with eight years’ of contributions worth £17,600 — a loss of 8% on his total payments after surrender penalties.
“Call my cynical, but it seems the firm spends more time making money for itself and shareholders than for investors,” he said.

Comments

[Wills]

The Endowment schemes have hit thousands of people, its a shame so many people where promised so much and had been let down by the scheme, hopefully most who need to get out have done so by now.

[Newton]

I took out a range of insurance products simply because I thought the companies would demutualise. Most did and I pocketed some nice profits. Overall though I have been stuck with several poor performers because they were sold to me without any mention of the dreaded 'market value adjustment' which means that the companies can make realisation of funds very expensive. It is this and the other onerous conditions of these policies that has caused most of the trouble. The policies are sold with all the emphasis on the wonders of 'smoothing' and the unlikelihood of a MVR being imposed except in the most unlikely event of sharp market falls. No one mentions that some of these companies are financialy inept or burdened with huge oveheads like their grand head office buildings and huge commission payments to IFA's

[Iain]

What really gets me at the moment is that I have a 25 year policy with ( what was CU ). Each year the bonus letter say they seek to give a fair balance on bonuses compared to returns. The last 3 years the FTSE has grown by what 20%? What have they done with bonuses? NOTHING.

Then to cap it all they suddenly discover billions in these surplus assets they built up in not paying out in bonuses and they want to give my cash out to shareholders!

THAT is the real robbery!!

[john orgill]

Ten years ago I invested in the Teachers' Building Society's very own 'Friendly Society' Account. I paid £600 each year for my wife and myself, to the TBS for promised lucrative tax free benefits. This guaranteed myself and wife a massive £2500 life insurance payout plus bonuses. After ten years of paying into this account for my wife and I, a total of £6000, we received the princely sum of £6080. I am even more incensed by the fact that three years ago, having recognised the poor performance of this fund, I rang the company to be told that most teachers were highly delighted with the scheme, having received double their invested sum. Also, that the fund grew most rapidly during the final months of completion. Thank goodness it has. My own share of this less than wonderful investment was the sum of £9 from an investment over ten years of £3000. They even had the effrontery to enclose a form for me to post to them if I wished to re-invest my awarded sum. Some chance! Let this be a warning to other teachers.

[Chris Green]

Re:"Insurers to 'rob' savers of billions" in Money Section of ST 18/03/07 - I just can't believe that Standard Life has £500 million of surplus assets that it "may" pay out to with-profits policy holders by boosting bonuses!!
What's to think about?
If, like me, a large number of WP policyholders will have deficits at maturity on either their endowments, or pensions, such payments will at least go some way in easing the pain.
I have been told by Standard Life that my 20 year WP endowment, targeted for £35,000 and to mature in September this year, will likely be worth £29,430.
I realise it's probably too late for me but I feel it's worth making the point for other policyholders.

[Flavia Wisniewski]

My worst investment was, and is, a maxi ISA in which I bought £7000 of Invesco Perpetual European Growth Acc Share; value at last valuation date of 31 August 2006 was £3612.80. Pretty bad!

[Steven Cassels]

We have a FP With Profits 10 year plan due to mature in April 07. FP wrote to us expressing their pleasure at the maturity of our policy. Over 10 years we have contributed £2960. Our maturity value is only £130 more than we contributed. How can FP get away with misleading us that they keep back some money in the good years to pay extra in lean years? Its simply a lie. Their financial mismanagement is staggering. I agree with previous posts. This company simply cannot be trusted. I will NEVER consider them at any time in the future

[barry larke]

The real with profits scandal is now becoming apparent.

Due to the return of poor bonuses to with profit bondholders since the 2000 equity bubble burst it is now clear that with profit funds are awash with surplus cash which has been withheld from policy holders bonuses in the intervening period.
The audacity is that the insurance industry now wants to pass this surplus to shareholders and not the policy holders. If the FSA lets this proceed then the finance industry is much more corrupt than we imagined !

[Hugh J Osburn]

Belatedly (for which I apologise for not contributing before): The Background Story to very low values realized upon maturity of Pension Plans which, apparently, no financial journalists have previously picked up on:

Unintended consequences of Mis-guided intervention by the UK Government during 1988 which specified the assumptions which Life Insurance companies had to make regarding their fees and charges, when quoting for Pensions:

Prior to 1988, when giving quotes for Pension plans, Life companies had to quote anticipated returns after deduction of their actual levels of fees and charges. Once the UK Government intervened, around 1987/88, to require these companies to use standard "uniform" assumptions, practically all the Life companies quickly realized that they could increase the actual levels of the fees and charges without impacting upon the likelihood of their actual charges affecting the chances of them obtaining new business. As a result, regrettably, they practically all increased their fees and charges - often doubling, trebling and, occassionally, even quadrupling the levels of their fees and charges over the levels these were before.

John Corad, the retired dentist from Wales (quoted in Money, today), was - in relative terms - one of the lucky ones. Those with much smaller pension "pots" lost far more, in percentage terms, of their originally anticipated pension funds.

The underlying reality appears to have been missed by most observers (and journalists), namely that the poor returns have generally NOT been as a result of poor investment performance which - in the majority of cases, has in fact exceeded even the more optimistic of the two projections that the Life firms were allowed to make by the UK Government in their quotations when selling their Pension plans to the prospective policyholders.

Hope this helps cast some light on a dark and little understood aspect of the current Pensions debate. If one of your journalists would like to research the matter further, I would be delighted to try and help (by furnishing further evidence, etc.)

Regards,

Hugh J Osburn, MBA FCMA ASIP CFA

[kevin]

Zeros - Are there any past investors out there in one of yesterdays investing disastors who might know how the Inland Revenue intends to treat FDL compensation payouts-taxfree compensation - capital gain - earned income ???

[Bob Donaldson]

The comments just go on and on and the system is just as bad for advisors to try and make sense of.

It is a sad reflection of the industry which I work in that many (not all of the companies) have managed to give such diabolical returns. They allowed the tail to wag the dog i.e. the marketing departments rather than giving due diligence to the monies they were managing.

On the other side policyholders should also remember that the UK insurance industry was selling out of equities at a time when they should have been allowed to retain them which was the responsbility of the DTI and the rules prevailing at that time regarding solvency margins etc.

The long and short of it is that no one should consider taking any plan where they are locked into one company or fund for any length of time without the ability to move their monies without penalty when they wish.

Let us all learn from the past mistakes and try not to make them in the future.

[James Fergusson]

In answer to Mark Lee’s comments and questions on the example in the original article about Peter Carter’s investment. Whilst his assumptions about the advantages of tax relief on pension contributions are correct, the article does not suggest that Mr Carter’s investments were pension contributions. His early encashment of his children’s policies would imply that they were not pensions in which case the tax advantages would not have applied.

One important point that this highlights is the confusion between pension tax relief and investment returns. In broad terms pension tax relief defers the income tax you pay in the year of contribution to the year in which you take the income from your pension. It is neither a gift from a beneficent Chancellor, nor should it be confused with the investment returns (or lack thereof) offered by Pension providers. Pension companies sometimes behave as if the tax relief offered to pension savers is provided as a margin from which they can elicit high charges and deliver poor investment returns without attracting attention.

[Duncan]

In year 2000 we had funds to pay off our Bradford & Bingley Mortgage. Persuaded as there was an early redemption penalty NOT TO but invest in bonds. Some seven years later £60,000 invested yielded only £61,070 after penalties of £4,016. We have paid £20,000 plus in mortgage interest and despite, using a legacy to reduce it, we still have a mortgage. Losses from taking B&B advice well over £25,000
Promised interest rate of 9 or 10% on bonds was in fact 2%

[Pauline Blunt]

In March 2001 when my wife required some regular income she was advised by Bradford & Bingley to invest £50,000 in Royal & Sun Alliance so as to produce £208.33pm + possibility of capital growth. After 2 years it was clear that the income was deriving solely from a reduction in her units so she cancelled her withdrawals to enable full capital sum to be professionally invested for capital gain. After 6 years her capital is valued at £51,846.83, but due to MBA, whatever that may be, she will only receive £50,335.09. She has been invited to consult the ombudsman if she is dissatisfied. I can't imagine he will break from his career advancing lunches or dinners to give much thought to this or, by the look of it, to the many other similar cases. Is this incompetance or is this deception by blatant fraud that leaves a Resolution company with such profits and bonuses and its policy holders with virtually nothing, not even Bradford and Bingley annual interest? Something surely is not 'kosher' and will not encourage investment for the future by individuals, as this government would like, so as to stave off the eventual revolution by the taxed dry ageing poor.The justifiable action on behalf of railtrack investors was thwarted, is there any hope of success against 'Resolution' other than to totally discredit and expose them, and their investment deceptors? What about The Sunday Times championing an investigation into this scandal?
DHB

[Bruce Howard]

In March 2001 I invested $200,000 in the Man-Glenwood Select Limited Investment fund, a ten year Man group investment. Almost six years later, in July 2006,the performance of the investment was so bad the company offered investors the opportunity to redeem the investment early for a return after 6 years of $178,740, $21,260 less than the original contribution. What a disgrace from one of the UK's leading investment managers.

[Alan Cox]

I have a 20 year with profits endowment policy with Scottish Widows my premium is GBP 316.11 per month. The last surrender valuation I had in 2003 was GBP 34872. I have currently contributed GBP 54350.48 to this policy which matures 26/11/2012. The policy is assigned to a mortgage and is supposed to pay off GBP 128500.00 of the mortgage. The only correspondence I get from SW is your policy is unlikely to reach the projected maturity value so you need to take out more endowment policies!!! I am afraid this whole mortgage endowment saga is a disgrace. Another with profits endowment policy I have is with the Equitable Life need I say anymore?

Regards

Alan Cox

[Mike Brumage]

My low cost (sic) endowment mortgage in the form of a Royal Insurance With-Profits Life Policy was sold to me in in 1991. Target:£94K by 2010. "In fact, Mr Brumage, you'll probably have a nice little nest egg over and above that to take into your retirement," quoth the salesman. Since then the policy has passed through Royal & Sun Alliance to its current home with Phoenix. Currently it is on track to deliver £55K, a shortfall of £39K. Points emerging from this nightmare investment:
1. Sun Alliance (and now Phoenix) have effectively shut down this policy and are paying 'dead building society account' interest only My policy's bonus rate is running at around 0.25%..
2. The surrender value is derisory.
3. I have tried formal complaint but have been "timed out'.
4. In sum, I am now resigned to the fact that I was sold a pup in 1991 and have been taken to the cleaners ever since. The average guy like me, with only a couple of hours at night when he gets home from work (if I'm lucky), hasn't a chance. To take on the likes of Sun Alliance/Phoenix is a full time occupation.

[plonkee]

I believe that with profits policies have been unable to take advantage of the rise in equities as they have had to hold more of their value in bonds, which have not done as well.

Does anyone else know whether this is true?

[J Parker]

Sir, very briefly in March 2003 the stock market reached a low of 3277 (FTSE 100 : source yahoo). I don't see where you get "103% return" in Kathryn Cooper’s front page article 11 March 2007 – this is just incorrect.
You say, “still suffering the after affects of the 2000 to 2003 bear market, but the stock market has rallied 103% since then” – what financial manipulation is this?
In any event the article is talking about investors who went into the stock market in 1999 & 2000 when it ranged from 6000 to 6900 (FTSE 100).
As the FTSE stands at about 6200 today it is no wonder they have had poor returns as there is no growth in the index.
For these investors (1999 -2000) returns are disappointing. You need to be canny and get your market timing right, With Profit Funds get rid on the timing element – and because of the long term bear market investors will need to see the FTSE at least at 8000 before they will see real returns on their money out of these funds. Nothing in life is guaranteed, but your bed is also not a good bet, and the horses – well it is Gold Cup week - so take your choice.

[Ivan Wain]

I had paid into three small pension schemes. On retirement I had to take out a Pension. The total sum invested was £44348. This was placed into three Scottish Widows pensions September 1998 after advice from my financial advisor. To date I have received a total sum of £25348 in pension payments. If I had invested at standard rate over these years and taken out the same amount as I have received in Pension, my capital would now be £38671.
At present interest rates and taking out the same sum as I have received over the last year this sum would have lasted me a further 20 Years until I would have been 92 old. I should be so lucky!

[Graham Dawson]

My investment nightmare was a ‘Wealth style’ policy taken out with RSA in 1993. In November 2001 I questioned the performance and, after taking over a year to get a proper response to my questions, I eventually cancelled in December 2002 losing 16% of the investment value (much of that in the year in which I was questioning the performance). RSA were not interested in any complaint and the financial ombudsman didn’t take an interest initially because it was not mortgage related.

After 27 months the ombudsman did not find in my favour. Three interesting facts emerge from the ombudsman: the company was not required to advise that the funds were not guaranteed; the company could not provide a copy of their initial assessment of my circumstances used for recommending the policy; the ombudsman stated considering the income of my wife and I we could afford to take the risk, although we didn’t know we were. From recent reports it would appear that in spite of all the additional ‘regulation’ since that time the individual is no better protected.

Final comment noting an earlier contribution, there were no tax advantages, the loss is real.

Regards

Graham Dawson

[peter vince]

My wife,Wendy and I were each sold a PEP 9 years ago by Scottish Widows who came to our house for the purpose. Mine is only now worth slightly more than the £7000 I invested. Wendy's £7000 is worth £4900 as at last month and that is the highest it has been for years.

The nearest to an apology I have received from Scottish Widows is "We are sorry that you are disappointed in the performance of your investment" What do they expect? How on earth can they be allowed to continue placing full page adverts trying to entice unsuspecting people to invest with them.

The sheer incompetance which produces a loss of about 40% when the market rose over the same period by 20% makes me see red every time that silly widow smirks at me over my cornflakes!

[G J Gough]

I read with interest your article in Money this weekend. Eight years ago I took out 3 policies with Teachers for my Grandchildren and have invested the maximum of £300 for each of them every year.Having only grown by 1.5%pa over the past 8 years, they have sent me a forecast based on a minimum return of 4.5% which shows a growth over 15years on an investment Of £4500 of £420. ie 9.3% over 15 years. The way these policies are sold is quite appalling and organisations such as Teachers and Friends Provident should be held to account.

[J Potter]

I was advised in 1993 by a financial adviser to transfer 6 years of a company pension into a personal pension and contribute £20 a month into the fund. I did so until 1999 and stopped payments.My Scottish Equitable fund had a value of £6,245.39 when I stopped paying in.
I discovered last week to my shock that Scottish Equitable had been taking an annual 'Paid Up' management fee since I stopped paying in which is currently £53, on top of all the other fees.

Mt pension fund has a transfer value of £770 and a fund value of £570.
My pension was invested in a so called 'cautious' fund, I don't think so.
I have spoken to the Broker who sold me the pension and who was supposed to be managing it, they aren't interested as they have had their commission from me over the years and as far as they are concerned my fund isn't worth bothering with.

In the meantime a company pension that I have not paid into for 6 years has matured over 50% in this time.
This obviously shows that the management companies aren't looking after our interests.

[Sylvia Robertshaw]

My husband and I have had an endowment policy with Standard Life since 1989 with a promise when it matured in 2014 it would be worth £31,000. We pay £48.50 per month. Standard Life now say our policy on maturity will be worth between £16,00 and £22,000. We have no confidence in Standard Life and wonder if we would be better off surrendering the policy and investing the lump sum in a high interest saving scheme with a Building Society. With 7 years left before our policy matures and no real guarentee of what the final lump sum will be could you advise if we would we gain more financially by surrendering our policy and investing in a Building Society account or another form of investment scheme?

Regards,
Sylvia Robertshaw

[Chris Heginbotham]

Having read your article in yesterdays' Times I was interesteed to note the list of Loss Making Plans and in particular Colonial Mutual. When my wife and I took out our first endowment (low cost) with Colonial Mutual back in the 1970's the Halifax Building Society insisted that they (Colonial Mutual) undertake to pay off the mortgage debt at the end of the term regardless of the performance of their investments. Colonial Mutual did this. I recall speaking to the Branch Manager at the time and he stated that whilst they were happy with Standard Lifes' performance Colonial Mutual was an unknown quantity. I am pleased to advise that the Colonial Mutual policies performed adequately and this was enhanced by their subsequent demutualisation and the shares we received. Unfortunately we later took out a Standard Life Policy (who did not require to guarantee to the Building Society to pay off the minium amount) which is now failing on all fronts and no chance of paying off the amount when it matures in 8 years time. On present forecasts over the 25 years we will have paid in £24,000 and Standard Life are predicting a return of £27,000. At least the Prudential are boosting their Endowment Policyholders. Can't see Standard Life doing that.
Chris Heginbotham

[Mark Lee]

Further to my earlier comment the same point applies to the comparison made in the panel on the right hand side of the article in ST - source: Money Management.

We are not told whether the £200 per month is net of tax or is the gross value of the investment. If it's the net of tax cost then the value after 10 years is awful as the gross value of the sums invested would have been significantly higher than the net £24,000 investment.

Equally, if the £200 per month is the sum invested before accounting for tax relief, the return on the net investment is probably much more acceptable.

As per my earlier comments I am confused as to why the impact of tax relief for pension investments is not addressed.

[Mark Lee]

I'm not so sure that that the investment returns and comparisons quoted in the ST article are correct. NB: I have no connections with the pensions industry.

The problem for me is that there is no mention of the impact of tax relief so I can't be sure whether the pension investment returns are really much BETTER or much WORSE than the article suggests.

Take the example concerning Peter Carter who, we are told, had contributed £24,000 and learned that his policy would be worth only £22,800 in 2 years time.

Sadly our tax system is so complicated that there are at least 3 possibilities:

1 - Peter contributed £24,000 net of 40% tax relief.
If this were the case then Peter's pension contributions were worth 100/60ths = £40,000. A forecast value in 2 years time of only £22,800 is far worse than anyone has suggested to date;

2 - Peter contributed £24,000 net of 22% tax relief and then obtained higher rate tax relief for his contributions.
The net cost to him, if this was what happened, would have been only £18,461. This is the net cash cost to him that should be compared with the forecast value of £22,800. It's a return of a little over 20% - and comparable with the rise in the stock market;

3 - The 3rd possibility is that £24,000 is the amount invested in the fund.
The net cost to Peter however would have been only 60% of this, that is £14,400. If this net investment will be worth £22,800 in 2 years time the effective investment return is 58% which is not far off the 60% increase that Peter has achieved on his £1m portfolio.

I am often confused by the way that people compare their pension investments (that qualify for tax relief) with other investments that are not so favoured.

Simply stated: If you have £6,000 to invest you can either attempt to manage this yourself or you can put it in a pension where it is immediately worth £10k. Even if charges reduce that £10k to £8k over a year or so your net investment of £6k has increased in value by 33% to £8k. Few people could be assured of a similar return if they arranged their own investments. Of course there are constraints on how you can access your pension investments but the comparison still seems more valid to me than those we often see in the press. Or am I missing something?

[Mark Casey]

You asked for people who have reclaimed penalty charges to contact you
Well I have claimed off MBNA and got them to refund all the penalty charges Plus contactual interest
I am due in court on 26th of this month with Barclays but I expect them to pay up a week before this
and am in the proccess of claiming back charges from a Tesco credit card
you can get details of lots more people claiming by going to
http://www.consumeractiongroup.co.uk

[John Knowles]

You ask for information about investment nightmares. I have a With Profit Investment Bond with Scottish Mutual(Resolution). For the last 4 years a MVA charge has been applied and I have received no annual bonus. In 2006 the MVA was reduced to £1.8k. In 2007 following the takeover by Resolution the £MVA has been increased to £2.3k. I have a MVA Free Guarantee Date in 3 years' time, but unless I am prepared to lose £2.3k I am stuck with an investment which is yielding nothing. In the meantime Scottish Mutual is using my money to prop up its ailing organisation and I am having to pay for its failures in investment management. This seems very unfair and I think the government should step in and outlaw this outrageous and morally deficient practice.

[Rosalie Thomson]

I read your article with interest and would like to add that I have been caught in a scheme that has paid no interest for the last few years. I have two with profits policies (moneybuilder and bonus sharing endowment) with the RNPFN which was taken over by Liverpool Victoria in 2001.I understood why there were no additions for the first 2 years, however, since then the markets have been on the up. It would appear that the company has poor investment stategy and thinks that once they have people locked in to monthly paytments that they need try no more. Several of my friends have taken their money out - I - probably wrongly, have continued to pay. These policies were mostly taken out by nurses and allied medical professions as a safe way of saving money - where did it all go wrong?

[peter wakeling]

Remenber Mr manek,Sunday Times fantasy winner 2 years running Now nearly 10 years ago. He has sucessfully managed to turn every thousand pounds in to £920.00
What a Clown he was.And still is come to think about it

[ian binns]

Re Worst investments.

The cited examples were over 10 years,
I have a 23-year endowment with Zurich.
When it matures in three years time and 7% (claimed) growth is achieved - the resulting payout is equivalent to my original contributions plus an annualised growth rate of 2.35%.

Is this a record ?.

IB

[andrew martin]

i had a ten year savings policy with friends provident, which matured in 2003. After paying £20 per month(£2400 in total ) I received back £1800 at maturity. When I queried this I was told that the last few years had been poor for the stock market. I wouldn't touch anything to do with Friends

[Paul Wright]

I couldn't agree more. These pension firms are carrying out the biggest con this country has ever seen.

Like many thousands of investors scrimping and scraping to contribute to a small pension for their old age, I too have paid into a pension since 1994 only to find that it is actually worth less than the amount paid in. Statements are sent to customers each year but dont actually readily reflect how much you're making (or rather losing) and one tends to chuck it in a file without working it out.

They simply give you the standard 7% growth assumption and tell you what you can expect when you retire if it grows at that rate. RUBBISH! If the fund hasn't grown by an average of 7% per annum since 1994 (in fact it hasn't even grown by 1%)then it will need to grow by at least 15% from now on to average out at 7% by the time I retire! Not much chance of that from their performance so far!

Why should young people even think of paying money into a "BIG LEGALISED NATIONAL CON" as the government seems to encourage. A complete waste of time!

[Neil Barsby]

I find myself in exactlty the same position as Peter Carter.

I invested a total of 2400 quid in a 'with profits' savings scheme run by the CIS and was amazed when I received a cheque for 2600 on maturity - I would have been far better putting the money in the building society.

Over the same period I have invested in the stock market and have more than doubled my money.

How is it that a thick geordie such as myself can do this - while 'so-called' professionals can apparantly lose money.

There must be more to this than charges and poor management.

[PETER MARTIN]

As an investor in R&SA, now Resolution, I blame the FSA for this mess.
The FSA has allowed the sale of funds to Resolution, who have paid their directors vast sums in salaries and bonuses and now the CEO is to receive a pay off of £6m.
All this whilst investor are receiving nothing. Yet the FSA stands by and does absolutely nothing.

[Brian]

I could not agree more.
I have a 25yr endowment with Friends Provident and their attitude is disgraceful. I now pay £700+ per annum and receive little bonus or profits, last year was 0.1%.
The maturity date is 12/2008 so I have little option but to pay until then otherwise I will not receive any final bonus.
I would advise every person I know to stay well clear of this appalling company.
The FSA are not much better as they should be able to ensure Friends pay a reasonable bonus, even a total idiot could make some sort of money at the moment. The Fund Managers at Friends maybe legally correct but they are morally bankrupt.

Brian

[John Blackmore]

Ah ! you have hit upon the "real" endowment scandal. The real problem was not so much the way policies were sold or mis-sold but the way Life Companies have mismanaged funds. Why then have the FSA allowed the focus of complaints to be on the sales process ? The answer is that even though it is known that the Life Companies are mainly responsible for the failure of endowments there is nothing that can be done about it. To close most of them down would not serve the public good - far better to go after the Salesmen and Advisers and give the impression that corrective action is being taken. It would not have mattered how they had been sold if the funds had been managed properly.