Tony Hetherington is the Financial Mail on Sunday’s star investigator, battling readers’ corners, revealing the truth behind closed doors and winning victories for those left penniless. Find out how to contact him below.
PB writes: In January 2023, my wife began making a regular monthly investment into her Hargreaves Lansdown shares account. Last October, Hargreaves Lansdown asked him about the source of the funds. She gave him a clear answer and was told that was the end of the matter.
However, they wrote again, asking for the same information and threatening to cancel their investment and restrict our other accounts. We complained and they apologised and paid us £500, but then said they wanted details of the source of all their funds going back 21 years.
Tony Hetherington answers: By the time he contacted me, Hargreaves Lansdown had already frozen his wife’s accounts and refused to allow withdrawals. As well as her share account, they both have pension plans and Individual Savings Accounts (Isas) with the firm, of which they have been clients since 2003.
You would think that after two decades Hargreaves Lansdown would know enough about you, but in March this year his wife was asked to reveal “the full source of the payments that have funded the account since its inception”.
He opened an Isa in 2003, a self-invested personal pension in 2005 and a stock and shares account in 2007, and the brokers insisted they would “require evidence/information for each of these accounts from these relevant dates”.
Hargreaves Lansdown is a savings and investment service employing over 2,000 people.
You asked me: ‘Can it be right that we are now being denied our 2003 £7,000 Isa contribution via capital withdrawal because we may not have evidence of its source of funds 21 years later?’
Hargreaves Lansdown told me: “Clients are not expected to retain evidence of all their financial records.” But disturbingly, he added that they do expect clients to be able to provide employment history, details of any inheritances and evidence such as bank statements showing salaries. It became clear that Hargreaves Lansdown was using its anti-money laundering team to carry out the investigation into him.
What caught their attention was that his wife was paying an extraordinary £10,000 a month into his stock account. The brokers wanted to know where she got this money from. And the answer, ridiculously, was that it came from cash she had in a different account at Hargreaves Lansdown.
The money was transferred to their bank and then returned to the brokers each month to be invested in an index-tracking fund. What was the point? Well, one good reason was that Hargreaves Lansdown did not charge commissions for a regular investment from an external account.
And where did that money come from? It came about four years ago after many years of investing in shares, which his wife converted into cash when Covid hit. And where were all those shares for so many years? Where else but Hargreaves Lansdown?
An ISA, or individual savings account, is a tax-free way to save or invest. The two main types are cash ISAs and stocks and shares ISAs.
One of the brokerage firm’s managers agreed that their reinvestment plan made perfect sense. But more recently, perhaps after realizing that he had found a way to avoid commissions, the company decided that this was “a misuse of our service.”
I asked for clear answers. Should customers keep personal financial records forever? And why didn’t the company ask their questions when their funds were first deposited?
Hargreaves Lansdown said clients are not expected to keep records forever, but sidestepped this by adding that it would carry out “enhanced due diligence” where necessary. As for asking questions before, the answer was that the questions only arose after the rollovers began.
Hargreaves Lansdown continues to demand full details of your wife’s employment over the past 21 years, including salary figures and other income. You refused to meet the firm’s deadline last Monday, so I now hope the brokers have frozen your funds again.
When there is a final result I will communicate it, but right now there is a wall that can only serve as a warning to the firm’s other clients.
We are watching you
A criminal who defrauded investors out of more than £1m has been jailed for five years and eight months at Basildon Crown Court.
Ross Perry, 44, pleaded guilty to fraud relating to his company Global Water Group Limited.
He said the company had a successful six-year track record and belonged to “a senior network of investors and advisors on water supply issues, whose members include heads of state, global water industry leaders, leading universities and academic institutions, wealth management firms, philanthropists, pension funds and high net worth investors.”
I noted in 2021 that I already knew Perry. In 2012, he had been a director of Elite Asset Exchange, which marketed investments in storage units before it went bust. And in 2013, he was the head of London Green Financial, a fraudulent company that promoted investment in carbon credits before it also collapsed.
Police are tracking Perry’s assets so they can confiscate them to compensate his victims.
If you believe you are a victim of financial irregularity, please write to Tony Hetherington at Financial Mail, 9 Derry Street, London W8 5HY or email tony.hetherington@mailonsunday.co.uk.
Due to the high volume of enquiries, it is not possible to provide personal responses. Please only send copies of the original documents, which unfortunately cannot be returned.
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