Mint still haggling over GTEP claims

Mint Financial has refused to comply with a Financial Ombudsman ruling to compensate investors in a failed Intregity Maximiser plan for 18 months while it haggles over how much to give the elderly couple.

FOS ruled last year a Mint IFA was wrong to recommend the risk averse couple, who are in their seventies, borrow £200,000 against the value of their home to invest in the high-risk geared-traded endowment policy.

However Mint, which was taken over by Intrinsic in 2008, has since been locked in a dispute with the couple over the size of their compensation payout, the Daily Mail reports.

In March, IFAonline revealed Mint was about to settle a £2.6m compensation bill for giving poor advice on Integrity Maximiser plans.

Law firm Regulatory Legal, which acts on behalf of about 20 Integrity Maximiser investors, said Mint has paid out on some claims of poor advice related to the plans.

The FSA last year closed its investigation into Integrity Financial Solutions, the company which created the Maximiser product. The regulator censured the firm and said it would have fined it £350,000 for a range of failings relating to the Maximiser plan, but by then Integrity had gone bust.

Integrity Maximiser plans invested in traded endowment policies (TEPS) offered by Integrity and sold, in most cases, to investors via their own IFA.

However, investors often were not aware that a second loan from the Bank of Scotland or the Newcastle Building Society was raised on the strength of this first tranche of TEPS, and from this further or "geared" loan a further tranche of TEPS was purchased.

The effect of the gearing was to hugely increase investors' losses.