ISA Transfers - How does it work?

[MarillionFan]

Just had a thought as I was taking a lump hammer to an air conditioning unit on the side of the shop as part of the schedule of repairs. I wonder 'bang' how ISA Transfers work?

Some ISA's will allow you to transfer funds from previous years into a new ISA. This is normally when moving the ISA from Bank A to Bank B. All of my ISA's have their own sortcodes and account numbers, and therefore primarily it is impossible to tell they are an ISA account say versus a current account based on those numbers.

When looking at a transfer form I was asked to provide the account number and sortcode of my ISA accounts to which the funds would be coming from.

What is to stop you telling the new bank you have £30k say in your 'ISA' cash account built up over the years and in fact transfer in from a current account.

How would you get caught?

My learned friends does anyone know?

[mudskipper]

ISAs are 'special'. The to and from banks communicate - think they'd spot your ruse.

Transferring them is far from the painless experience it should be - when I did it, it was a lengthy process involving cheques and royal mail. I think I ranted at the time!

[MarillionFan]

ISAs are 'special'. The to and from banks communicate - think they'd spot your ruse.

Transferring them is far from the painless experience it should be - when I did it, it was a lengthy process involving cheques and royal mail. I think I ranted at the time!

Maybe. I think banks are more stupid than we already think they are.

There's a very interesting glitch between Barclays and the Woolwich. If you have a Woolwich offset mortgage and a Barclays bank account, the amount of interest you pay is based on your mortgage minus the amount in your Barclays account at the end of the day. By accident about 5/6 years ago I bounced a £15k cheque. The funds showed as a 'balance' albeit not cleared on my current account for 7 days before coming out and I got charged £15. When I got my statement my mortgage had been reduced by the cheque for a week.

At the time I was paying maybe 5%. So a few weeks later I decided to pay a cheque into my current account for £150k from another account that had no cash. Low and behold the cheque bounced. I got charged £15. When I got my mortgage statement, for the seven days it had reduced my payments and balance by £140.

I've done it a few times since.

[Churchill]

Maybe. I think banks are more stupid than we already think they are.

There's a very interesting glitch between Barclays and the Woolwich. If you have a Woolwich offset mortgage and a Barclays bank account, the amount of interest you pay is based on your mortgage minus the amount in your Barclays account at the end of the day. By accident about 5/6 years ago I bounced a £15k cheque. The funds showed as a 'balance' albeit not cleared on my current account for 7 days before coming out and I got charged £15. When I got my statement my mortgage had been reduced by the cheque for a week.

At the time I was paying maybe 5%. So a few weeks later I decided to pay a cheque into my current account for £150k from another account that had no cash. Low and behold the cheque bounced. I got charged £15. When I got my mortgage statement, for the seven days it had reduced my payments and balance by £140.

I've done it a few times since.

Moral Turpitude, isn't the above a classic example?

If you lived in the US the Secret Service would be arresting you.

[MarillionFan]

Moral Turpitude, isn't the above a classic example?

If you lived in the US the Secret Service would be arresting you.

Moral?

I don't remember 'Thou shalt not rip off the bank' in the Bible so Im OK.

[Gonzo]

The old and new managers have to talk to each other, it is not as easy as telling the new one which account(s) to debit.

You can have a look at the guidance notes for plan managers from the HMRC site to see if you can spot a hole.

Chapter 11 is the one that you want. Knock yourself out.

[Peoplesoft bloke]

Having contracted at a couple of retail banks and shared office space with a project doing ISA transfers I concur with the panel that there is more to it than sort codes - so in the words of Nigel Molesworth, it is a wizard wheeze but probably would not work.

Also banks have some very serious (and extremely dull) "compliance" dorks in them these days preventing simple scams like this.

[Fred Bloggs]

Cash ISA transfers are a nightmare. Unfortunately, now that most accounts only pay a decent interest rate for one year, you need to move your ISA's every year. The most useless outfit I'm aware of is the West Brom BS who seem totally incapable of simply recieving a cheque and paying into an ISA account. Even worse, when you ring them they refuse to believe they have an issue at all. And they can never, ever find a letter that you have sent even when sent recorded delivery. They caused several ISA cheques to be issued and cancelled three times last year when transferring from a Scottish Widows cash ISA to them. Avoid at all costs.