The financial ombudsman has told Money&Co to pay £50 in compensation to a lender that was overcharged by 19p.
In June 2019, the investor, labelled as Mr H by the ombudsman, noticed the fees that were taken from his portfolio equated to more than the one per cent he agreed to.
Money&Co accepted Mr H was overcharged fees on the interest he earned on his account and it was said this was due to a rounding error in its systems for smaller holdings.
The platform said it calculated that Mr H had been overcharged by 19p in the period since he opened his account in March 2018 and credited this amount back to him.
Money&Co then offered to pay £10 in compensation into the account and said it would introduce a procedure that involves a six-monthly correction payment for lenders who have been affected by the rounding issue in the future.
Mr H remained unhappy that the problem with the incorrect fees being charged had not been amended and referred his complaint to the ombudsman for an independent review.
Since the investigator issued his opinion, Money&Co said that the net result of the rounding error is that Mr H actually benefited from it because the difference between the extra interest he received is more than the additional fees he paid.
The financial ombudsman’s investigator recognised this but upheld the complaint and said the platform should pay Mr H £50 in compensation and if it has paid the original £10 promised, this amount can be deducted from the amount due.
“I acknowledge that Mr H did become frustrated with Money&Co’s initial failure to provide him with a clear explanation of why he was paying the wrong amount of fees,” Ombudsman Daniel Little said in the decision document.
“I understand Mr H feels Money&Co’s systems are flawed and he wasn’t receiving proper answers to his concerns.
“This caused him to have to chase things up and pursue a fuller explanation of why he was being overcharged. I acknowledge his frustrations and why he felt he needed to peruse the matter – which took up more of his time than it should have.
“And it is only more recently in discussion with the service that Money&Co has provided an explanation on why the rounding issue hasn’t had a detrimental affect on Mr H’s account. I do think it is appropriate to award a small amount of compensation for the frustrations this caused Mr H – and also to recognise the time he has had to spend seeking an explanation.
“I agree that the figure our investigator recommended of £50 in total is reasonable in the circumstances. I appreciate that Mr H is seeking a higher level of compensation, but I don’t think the circumstances warrant this.
“In reaching this conclusion, I’ve taken into account the minimal financial impact of the rounding error and the fact Money&Co did cover the initial financial loss it identified.”