Old Mutual International (OMI) has had to write to hundreds of its clients worldwide as a result of an embarrassing administration error that has led to some third party charges on investments - going back up to three years - now being reclaimed by the firm.
The Isle of Man-headquartered international financial services giant has written to clients and IFAs concerned to apologise for the administration error, that has led to some third party transaction costs on its products not being billed.
When a trade is placed in, for example, exchange-traded funds (ETFs), equities or investment trusts there is what is known as a "third party custodian charge" which is passed to companies such as OMI and then paid by the policy holder. As a result of the error, OMI has failed to pass this charge on and is now looking to reclaim the fees as was originally agreed in the policy's terms and conditions.
We recognise that we failed to collect the charges and therefore we will waive the first £100 of charges for all customers, which means we will not reclaim the charges from the vast majority of customers"
Old Mutual International told International Investment that the matter is being dealt with and that in many cases clients will not face "unexpected" costs as the outstanding fees have been taken care of via a goodwill gesture of waiver on the charges of up to a £100 per transaction.
An OMI spokesperson said: "We apologise to customers for any inconvenience or confusion this has caused. We recognise that we failed to collect the charges and therefore we will waive the first £100 of charges for all customers, which means we will not reclaim the charges from the vast majority of customers."
It is not known at this stage exactly how much that the error and the £100 waiver will cost the company financially, though the company said that the matter has affected hundreds of customers, rather than thousands.