We invested in Hargreaves Lansdown for 21 years but we’ve been locked out: TONY HETHERINGTON investigates

Tony Hetherington is the Financial Mail on Sunday’s top researcher, battling reader corners, uncovering the truth behind closed doors and securing victories for those left out of pocket. Here’s how to get in touch.

PB writes: In January 2023, my wife started a regular monthly investment in her Hargreaves Lansdown share account. Last October, Hargreaves asked Lansdown about the source of the money. She gave a straight answer and was told that was the end of the matter.

However, they wrote again, asking for the same information and threatening to cancel her investment and restrict our other accounts. We complained and they apologized and paid us £500 but then said they wanted details of the source of all her money going back 21 years.

Tony Hetherington replies: By the time you contacted me, Hargreaves Lansdown had already frozen your wife’s accounts and refused to allow withdrawals. In addition to her share account, you both have pension plans and individual savings accounts (Isas) with the company, where you have been customers since 2003.

You might think that after 20 years, Hargreaves Lansdown would know enough about you, but in March this year your wife was asked to ‘disclose the full source of payments that have funded the account since its inception’.

In 2003 she opened an ISA, in 2005 a self-invested personal pension and in 2007 a stocks and shares account. The brokers insisted they needed ‘evidence/information for each of these accounts of the relevant dates’.

You asked me: ‘Could it be right that our £7,000 Isa contribution from 2003 is now being denied to us through a capital withdrawal because 21 years later we may not have evidence of its origins?’

Hargreaves Lansdown told me: ‘Clients are not expected to keep evidence of all their financial details.’ But, ominously, they added that they do expect clients 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 its investigation.

What caught their attention was that your wife was depositing a remarkable £10,000 a month into her stocks account. The brokers wanted to know where she got this money from. And the ridiculous answer was that it came from cash she had in another account at Hargreaves Lansdown itself.

The money was transferred to your bank each month and then back to the brokers for investment in an index tracker fund. What was the point? One good reason was that Hargreaves Lansdown did not charge for a regular investment from an external account.

And where did this money come from? It came four years ago from many years of stock investing, which your wife converted into cash when Covid hit. And where were all these shares held all those 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 broker’s managers agreed that your reinvestment plan made perfect sense. But recently, perhaps after realizing that you had found a way around the fees, the company decided that this was “improper use of our service.”

I asked for clear answers. Are clients required to keep personal financial information forever? And why didn’t the company ask any questions when your money was first deposited?

Hargreaves Lansdown said that clients are not expected to keep their data forever, but botched this by adding that they would carry out ‘enhanced due diligence’ if necessary. As for asking questions earlier, the response was that the questions only arose after the reinvestments had begun.

Hargreaves Lansdown is still demanding full details of your wife’s employment over the past 21 years, including salary details and other income. You refused to meet the company’s deadline last Monday, so I now fully expect the brokers have frozen your money again.

If there is a definitive outcome I will report it, but at this point there is a brick wall that can only serve as a warning to the company’s other customers.

We’re watching you

A conman who defrauded investors of more than £1 million 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 claimed that the company has been successful for six years and is part of “a network of leading investors and advisors in the field of water supply. Its members include heads of state, leaders in the global water industry, leading universities and academic institutions, asset managers, philanthropists, pension funds and wealthy investors.

I warned in 2021 that Perry was already known to me. In 2012, he was a director of Elite Asset Exchange, which marketed investments in storage units before it went bankrupt. And in 2013 he was the boss of London Green Financial, a scam that promoted investments in carbon credits before it too went bankrupt.

Police are working to trace Perry’s assets so they can be seized to compensate his victims.

If you believe you have been a victim of financial misconduct, please write to Tony Hetherington at Financial Mail, 9 Derry Street, London W8 5HY or email tony.hetherington@mailonsunday.co.uk.

Due to the large number of questions, personal answers cannot be given. Please only send copies of original documents, which unfortunately cannot be returned.