Bank denies mis-selling

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ISLE of Man Bank bosses have defended their treatment of an elderly customer who died within weeks of taking out an annuity.

Eighty-year-old Norman Hensher, who lived in the island, put most of his life savings into a pension from which he would never see a pay-out.

He had been diagnosed with throat cancer in August 2007 and died in March the following year without seeing a penny from the annuity into which he had invested nearly £500,000 of his life savings.

Insurance giant Aviva got to keep £485,000 of his annuity investment – while the salesman from Isle of Man Bank earned a £15,000 enhanced commission. Mr Hensher’s family are locked in a bitter row with Aviva and parent bank RBS International over the incident. But bank strenuously denies accusations of mis-selling.

In a statement it said: ‘Mr Hensher first contacted us of his own accord in 2007 with a view to purchasing an annuity. Following several meetings, in which we suggested that he consider an alternative investment, Mr Hensher insisted on purchasing the annuity. We strongly suggested Mr Hensher discuss the investment with family and friends before committing to it, and we also suggested the use of a capital guarantee, but again Mr Hensher declined our suggestion.

‘We regret that Mr Hensher passed away so soon after taking up this investment and have sympathy for his family. We have no doubt, however, that we acted appropriately and adhered to all regulatory requirements.’

Bachelor Mr Hensher lived in a hotel in the island. He first met a bank salesman in February 2007, before his throat cancer had taken hold, to get advice about investing money from the sale of his family’s furniture making business.

In August that year, he underwent radiotherapy after being diagnosed with throat cancer. By January 2008 doctors were concerned the cancer had spread. He had problems eating and now weighed less than nine stone. As the cancer progressed, he first took the painkiller tramadol and then morphine pills five to six times a day.

But after a phone call from Mr Hensher, the bank adviser paid him another visit that same month.

He chose to invest £500,000 into an immediate life annuity of a kind usually bought by people when they retire and typically paying a fixed income for life.

The bank says it warned him that no one would inherit his annuity, and it says he rejected advice to take out capital protection. It says he had a positive view of his life and was buying other assets. He was offered alternatives but when he chose an annuity he was found the best terms.

Tragically, he died a day before the pension should have paid out its first month’s income. He would, however, have had to have lived for more than a decade just to make the money back that he had paid out.

Mr Hensher’s family insist he was not of sound mind when he was visited by the Isle of Man Bank salesman.

His closest relative, his sister Brenda Brooks, herself a widow who lives in Worthing, Sussex, said: ‘It doesn’t matter how they try to justify their actions, Norman simply was not in a fit state to make a complicated financial decision like this — let alone one that involved such a huge amount of money.

‘One look at him would have told anyone that Norman was a very sick man.’

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