Customer Information
Contents
- Welcome to Scarborough Building Society
- Our Commitment to You
- Scarborough and You
- Protecting You and Your Money
- Financial Services Compensation Scheme
- Other Important Information
- Please note: We urge you to read all of the information below before applying for one of our products. This is a lengthy document, you may wish to download our Customer Information Booklet.
Welcome to Scarborough Building Society
At Scarborough Building Society, we believe in providing savings and mortgages that offer good long term value, are simple to understand and convenient to operate.We believe that we truly offer something for everyone. This section is designed to explain and answer questions you may have when opening your account, and how we work as a Building Society.
Our Commitment to You
We are pleased to subscribe to The Banking Code, which sets standards of good banking practice, which building societies and banks will follow in their dealings with personal customers. Copies of the Banking Code are available on request from your local branch, Investments Direct, the Society’s Head Office or you can also visit the Banking Code website to download the latest version.
In addition, the selling and administration of residential mortgages (not Buy to Let) and general insurance is regulated by the Financial Services Authority. Scarborough Building Society is fully compliant with the specific requirements of all relevant regulations.
We strive in all our activities to Treat Customers Fairly. If at any time you feel we are not fulfiling this aim, please contact us.
Scarborough and You
Why should I invest in or borrow from Scarborough Building Society?
The main business of Scarborough Building Society is to attract savings from its investing members and to make loans for house purchase to its borrowing members. Investing members provide most of the funds which borrowing members need to buy their properties. Borrowers pay the interest which flows through to the investors and becomes the return on their investment. Not all of the money invested in the Society is lent on mortgages – some is kept aside so that investors can withdraw their money when they want it, and in accordance with the terms of their account. Funds are also raised on the money markets subject to a restriction in the Building Societies Act which prescribes that a minimum of 50% of the funds held by us must be raised in the form of shares held by individual members of the Society.
Scarborough Building Society is a mutual organisation whose members are also customers of the Society. Being a mutual means that members can influence the Society’s affairs by exercising their voting rights.
There is no group of “owners” (such as equity shareholders) of Scarborough Building Society, separate from its members, to influence or direct our business.
Am I a member of Scarborough Building Society?
Anyone who opens savings accounts which offer membership rights with Scarborough Building Society become investing members of the Society and have a say in the way the Society conducts its affairs. Although there are many different names given to the savings accounts offered by the Society, technically the investments represent “shares” in the Society.
A building society investment is different in many respects from a company share. In a company, the value of shares can rise and fall and the income from the shares is not known until the company declares what the dividend is going to be. As a building society the nominal value of the investment made does not change, and the investing member receives a known rate of interest, which is either fixed for the term of the investment or varies broadly in line with other rates in the economy. In order to compete effectively within its market the Society, from time to time, will vary the rate of interest on its investment products and may also introduce new types of investment accounts to maintain an adequate supply of funds. This is necessary in order to meet the demands for its mortgage products and the need to maintain adequate levels of capital.
An investing member is a member of the Society and is entitled to the various rights described in this booklet. The Society will tell you when you open your savings account if the account does not give membership rights.
Mortgage borrowers are also members of the Society.
Do all customers have membership rights?
Not all customers of the Society are granted membership rights.
In many cases investors and borrowers have joint accounts, for example, a husband and wife, or other joint account holders, may hold an account between them. Only the first named account holder is entitled to the members’ rights described later in this section. You should choose the order in which names appear in the Society’s records. Initially, the application form will ask you to choose who will be the first named account holder. After that time, you may notify the Society at any time if you wish to change the first named account holder. Only the first named holder will be eligible to vote.
Scarborough Building Society offers a range of additional services, some of which may not give membership rights. People who use these services, although they are customers of the Society are not members and cannot vote at meetings of the Society.
Sometimes, the Society borrows money from depositors. A depositor, in contrast to an investing member, merely lends money to the Society and has no membership rights; depositors therefore have no say in the running of the Society and cannot vote.
If you become a customer of one of Scarborough Building Society’s subsidiary companies, you will not have membership rights in the building society.
What rights do members have?
Both investing and borrowing members (‘members’) have a range of rights. The most important of these are described as follows:-
1. Taking part in General Meetings
Qualifying members are entitled to receive notice of, take part in and vote at the Society’s Annual General Meeting (AGM). The AGM must be held within four months of the end of the Society’s financial year (the Society’s financial year end is 30 April and the AGM is usually held the following August). The AGM is held to receive the Annual Accounts and Directors’ Report, to consider the Auditor’s Report on the accounts, to appoint the auditors and to elect the directors. Changes to the Society’s Rules or to its Memorandum would often be considered at an AGM. Members can ask questions and make comments – they may also ask for the agenda to include a resolution to be discussed and voted on at the AGM, provided they are qualified under the Society’s Rules and have enough support from other investing members.
Where it is deemed in the interests of the members, the Directors may organise a Special General Meeting to discuss a specific topic. Members may also ask the Society to organise such a meeting. Five hundred or more qualifying members can request the Board to hold such a meeting (as long as the subject matter is not frivolous or offensive). For this purpose, investing members who qualify will have been members for two years or more and hold shares to the value of not less than £100 on the qualifying date, and borrowing members who qualify will have had a mortgage debt of not less than £100 and been members for two years or more on the qualifying date. In certain limited circumstances members can apply to the Financial Services Authority (the independent body which supervises societies) to call a Special General Meeting.
2. A right to vote
Building Societies operate on the principle of “one member, one vote”, which means that members have one vote each regardless of how many investment accounts or mortgages they have. Members can vote on proposals put forward at general meetings. An important example would be a proposal to merge with another society, or to transfer the Society’s business to a company. Members unable to attend a general meeting can appoint proxies to attend and vote on their behalf; if you are eligible to vote the Society will send you a proxy form on which to indicate your wishes and your vote can be used.
Members can vote on proposed changes to the Memorandum and the Rules of the Society. The Memorandum describes the activities that the Society can undertake. The Rules of the Society govern its relationship with its members. They can be amended only by a decision of the members at a general meeting, normally the AGM.
3. Electing Directors
Members elect the directors of the Society. All directors must be investing members of the Society. Currently, Scarborough Building Society has a board of eleven directors but this is subject to change as determined by the Board. The Board takes the major decisions in the running of the Society (such as deciding on the overall levels of interest rates, the products and services to be offered and the overall business strategy) and also appoints the senior managers. Directors usually serve three-year terms. The Society will let you know which directors are due to retire. Further details about the role, responsibilities and skills required to be a director are available on request from the Society’s Secretary.
Members can nominate candidates and stand for election as directors. Directors’ responsibilities are onerous and complex. Directors must take account of the interests of all the investing and borrowing members. Members therefore need to consider carefully before deciding to stand for election to the Board or nominating a candidate. Members standing for election can ask the Society to circulate an election address to the members of the Society. The Society will provide to any member on request details of the duties of directors and the nomination and election procedures. A director must be approved by the Financial Services Authority and will be subject to certain standards set by that body.
4. Rights to certain information
Members are entitled to receive a range of information, including:-
- A copy of the Society’s Rules and Memorandum (on request);
- A copy of the Annual Summary Financial Statement on the Society’s business (which is sent to investing members before the AGM and when an account is first opened);
- A copy of the detailed Annual Report and Accounts (on request); and
- Notice of the AGM.
The Society must also provide a range of financial and business information before asking members to vote on a merger proposal or on a proposal to transfer the Society’s business to a company.
Investing members with less than £100 in their share account and borrowing members who owe less than £100 at the end of the financial year immediately preceding the Annual General Meeting and members under the age of 18 have the right only to receive information on request - they cannot vote or nominate directors.
Protecting You and Your Money
Opening a joint savings account
You will need to decide if you want to authorise all transactions on your joint account on either an “all to sign” or “either to sign” basis. Please note that for accounts operated through Investments Direct where telephone access has been selected that it is not possible to operate a joint savings account on a “all to sign” basis.
For branch based and postal accounts (telephone access accounts excluded) if you wish to operate your account on an “all to sign” basis this will mean that both you and the other joint account holders will know what monies are being withdrawn from the account. This will also mean that all parties to the account will need to sign/authorise any account closure/withdrawal requests.
Should you choose to operate the account on an “either to sign” basis it is possible that the account may be closed and/or withdrawals made without your knowledge. However, you must be aware that you will still be responsible for withdrawals or amendments made by the other joint account holders. All account holders are entitled to see all information about all transactions on a joint account.
If you are not happy about this, you should consider whether opening an account on a joint basis meets your requirements. In the event that we are notified of a dispute between joint account holders, the Society may freeze the account until we receive written instructions from all of you. In such circumstances no withdrawals can take place until such time as we receive the written instructions of all the joint account holders.
For further information relating to Joint Applications please refer to section 4 of the Society’s General Investment Conditions or a member of staff at your local branch or Investments Direct who will be happy to assist.
Additional information can also be found in the Banking Code's leaflet "You and Your Joint Account"; which can be viewed at www.bankingcode.org.uk.
Proving your identity – Your questions answered
What is money laundering?
Money laundering means the methods criminals use to disguise the money they make from their crimes. Drug dealers, terrorists, robbers, burglars and other criminals have to get rid of the proceeds of their crimes because large amounts of cash are difficult to store, handle, transport and spend.
What has this to do with Building Society accounts?
One of the ways for a criminal to “launder” money is to pay it into a Building Society account so that it becomes more difficult for the authorities to trace. It can then be spent on luxury goods, services or used to fund more crime.
Why am I asked to provide proof of my identity?
Criminals frequently launder “dirty” money by opening an account using a false name or stolen identity. This might make it harder for authorities to track the criminals and their money during an investigation.
For this reason, before opening an account (and in certain cases, for some existing customers), we will need to have proof of your name and address, and occasionally date of birth in order to verify your identity. Please be patient when opening an account. To avoid delays, please ensure we are provided with proof of identity which is acceptable to us.
The financial services industry is determined to fight financial crime and money laundering. All firms in our industry have certain legal duties and responsibilities and can be criminally liable if they do not have procedures in place. Even if you only have a small sum to invest, checks must usually be made.
The fact that checks are made does not mean you are under any suspicion. It is a sad fact that criminals will always appear to be normal, law abiding customers – the only way to stop the criminals is to make checks on everyone.
What is “Identity Theft”?
Criminals can sometimes use the personal details of an innocent person to open and run an account. Victims of identity theft are known to suffer distress and significant financial loss. We encourage customers to carefully destroy all unneeded documents containing personal information before placing them in a bin.
Further information is available on the FSA’s website: www.moneymadeclear.fsa.gov.uk.
I am an existing customer. Will I be asked to provide proof of my identity or address at any time?
All financial services firms must maintain customer records, which occasionally have to be updated. Sometimes this happens when your own circumstances change, and sometimes when the situation calls for it (e.g. if you have not transacted on your account for a long time). If we are able to, and with your consent, we may use electronic checks or searches to obtain the necessary information, for your convenience (see also “What are Electronic Checks or Searches?” below). Alternatively, other paper documents may be acceptable (see Lists A & B below).
If you wish to inform us of a change of address for example, we will need to know that the request is from yourself and see evidence of your new address.
If you have not operated your account for some time but wish to make a withdrawal, we may need up to date confirmation of your identity and address before processing your request. This is because your account may have been recorded as dormant.
If we do need up to date information, please remember that this is done to help protect you against Identity Theft, or someone attempting to withdraw your savings without consent.
I wish to operate an account on behalf of someone else, what do I need?
If you are acting as trustee (say for your child), we need proof of identity and address for both yourself and the beneficiary.
If you are acting for a disabled or mentally impaired person, we need proof of your identity and address, together with an acceptable legal document confirming your status/power to run the account (such as Enduring Power of Attorney/Lasting Power of Attorney/Court of Protection Order etc).
I act as executor of an estate and have obtained a Grant of Probate. Do I need further proof of identification?
Further proof is only needed if you are acting without the assistance of a solicitor, or you are an existing customer and have not recently provided proof to us.
Do I have to send valuable documents in the post?
No. We recognise the risks in you forwarding original documents to us and encourage you to send “certified copies” instead. A certified copy is one which is confirmed as being a true copy of the original and is signed and dated by one of the following people:
- An employee of a firm (or individual) currently authorised or registered with the Financial Services Authority (e.g. an independent financial advisor or an insurance company, pension company, banker, building society, post office or mortgage provider)
- A current Member of Parliament
- A Justice of the Peace
- A Police Officer
- A Fire Service Official
- A current member of a nationally recognised professional body (e.g. accountant, solicitor, doctor, nurse, chemist, dentist, valuer or surveyor).
What are “Electronic Checks or Searches”?
Many financial institutions use reputable firms registered with the Information Commissioner’s Office to conduct searches against your personal details for the purpose of identifying you. Before we conduct a search, we will obtain your consent (this is included within the application form). Note that the search will not affect your credit profile or ratings. If the information you have given us is confirmed by the electronic check, then this may be accepted as proof of your identity and address.
Please note that electronic checks may be repeated from time to time in the interests of fraud prevention and the security of your account.
If the search does not confirm your details sufficiently, we will use the following procedure:-
If an electronic check is not used at all, what paper proof of identity and address is required?
We need to validate your identity (and that of the beneficial owner, if different - for example a child in the case of a Trustee account). In order to do this we will normally need to see EITHER;
- A Current UK Photocard Driving Licence, including current address, or
- one item from List A and one from List B, or
- two items from List B.
| List A | List B |
|---|---|
|
|
Please Note
- In the case of a Trustee account in the name of a child, the Trustee must provide full details as above plus one item from List A for the child.
- Birth Certificates cannot be accepted for adult identity verification.
- A single document cannot be used for both lists and that in some circumstances for direct/telephone accounts, you may be requested to send an additional recent utility bill.
- In order to open a Clubs or Charities Account we require the full identification requirements above for all authorised signatories and the Charity Registration.
What if I cannot provide any proof of identity which you require?
Special arrangements can be made in a few very specific circumstances. If you think your own circumstances prevent you from possessing normal proof of identity and address, we will be pleased to help you where possible and you will need to contact us to discuss the matter before opening an account.
Financial Services Compensation Scheme
All UK building societies are participants in the Financial Services Compensation Scheme established under Part XV of the Financial Services and Markets Act 2000. The Scheme is administered by the Financial Services Compensation Scheme Limited (FSCS), a body established by the Financial Services Authority (FSA). The Scheme is governed by FSA rules.
Activation of the Scheme
Before the Scheme can be activated, the FSA or a court must make a determination about a building society participant in the Scheme. This would usually happen if it was determined that a participant was unable to repay investments which were due and payable. An example of where this might happen is if there had been a winding-up order in insolvency proceedings.
Amount of protection
Under the Scheme, payments are limited to a maximum of £35,000 of an investor’s total shares and/or deposits in a building society. The payment is calculated by reference to all the investor’s protected shares with, and deposits in, the society. Therefore, for example, if a claimant had two separate accounts with the society, one containing £2,000 and the other £1,500, he or she would receive £3,500.
Protected currencies
Most shares or deposits with a building society are held in pounds sterling, but all other currencies are also covered.
Interest on an account
Interest earned on accounts at the time the shares or deposits become due and payable is covered by the Scheme (within the limit of the maximum payment). If a winding-up order against a society has been made by the Court, interest will immediately stop being paid on the society’s accounts.
Shares and Deposits which are protected
All building society shares and deposits are protected by the Scheme except -
(i) a bond issued by a building society which is part of its capital (for example subordinated debt);
(ii) a secured deposit;
(iii) a deferred share issued by a building society (usually permanent interest bearing shares);
(iv) a non-nominative deposit (that is, a deposit made without disclosing the depositor’s identity).
Investors who are protected
Most investors are protected including individuals and small firms, but there are some exceptions, such as larger companies and government bodies.
Joint accounts
In the case of a joint account each joint owner is treated as having a claim for his or her share and unless there is evidence about their respective shares they will each be regarded as entitled to an equal share. For example, if two people have a protected investment of £80,000 the maximum compensation to each would be £35,000, which would usually mean a maximum total payment of £70,000.
Partnerships
If two or more persons have a joint beneficial claim, the claim is to be treated as the claim of the partnership if they are carrying on business together in partnership. Otherwise the joint account rules (above) apply.
Trustees
If a claimant’s claim also includes a claim as a trustee, his or her claim as trustee will be treated as being separate from the claim in his or her own right. If the same person claims as trustee for different trusts, these will be treated as claims of different claimants. If a group of people claim as trustees their claim will be treated as that of a single person. If the claimant has a claim as a bare trustee for one or more beneficiaries, the beneficiary or beneficiaries will be treated as having the claim. There are further rules relating to trustees.
Personal Representatives
Where a person numbers among his or her claims a claim as a personal representative of someone who has died, the claimant will be treated in respect of that claim as if he or her were standing in the shoes of that person.
Agent
If a claimant has a claim as agent for one or more principals, the principal or principals will be treated as having the claim.
Funding of the Scheme
The cost of the FSCS in respect of savings and deposits in building societies, banks and others, and the cost of compensation payments under the Scheme, is funded by contributions from the businesses that are covered by the Scheme (including building societies, banks and others).
Making a claim under the Scheme
The Rules of the Scheme require a claim to be brought to the FSCS within a set time (normally within six years of the date on which the claim occurred). In practice, a building society would give to the FSCS a list of the names and addresses of the investors who may be able to claim under the Scheme. The FSCS would then send a claim form to each investor for completion. Full details of how to complete the form would be provided at the time.
Each claim would need to be verified before payment could be made. This could involve further questions being asked of those who have claimed and the FSCS asking the liquidator or administrator to confirm the amount of the investment on which the claim is based and to confirm that the claim does not relate to shares or deposits of a type that are not covered by the Scheme. Again, detailed procedures would normally be notified at the time.
Claims would be paid as soon as practicable (subject to the checking procedure) once the share or deposit became due and payable. In liquidation, that share or deposit would become due and payable on the date that the final winding-up order is made - in all other cases it would continue to its original maturity date. Payments would be made, normally by cheque in the currency of the account in which the share or deposit was held.
Further information
The Rules covering the Scheme are very detailed and this narrative does not deal with every aspect of the Scheme’s operation. Information about the operation of the Scheme is available on the FSCS website at www.fscs.org.uk. If you have any queries about the Scheme they may be addressed to:
- Financial Services Compensation Scheme
- 7th Floor, Lloyds Chambers
- 1 Portsoken Street
- London
- E1 8BN
- Tel: 0207 892 7300
- Fax: 0207 892 7301
- Email: enquiries@fscs.org.uk
Other Important Information
New accounts
From time to time we may launch accounts which do not accept internal transfers. This restriction will be made clear within the relevant product literature.
Marketing of services
If we believe they may be of interest to you the Society may, from time to time, forward information to you through the post, telephone, email or in other ways about our products and services, or those that are offered by Companies in its Group and associated Companies. You may request not to receive details of these products and services by these methods, at the time your account is opened, or by subsequently writing to the Society.
Investment account tariff
Details of charges relating to our investment accounts are available separately. Please see our Investment account tariff page, call into your local Branch or telephone Investments Direct on 0845 458 4522† for a copy.
Mortgage account tariff
Details of charges relating to our mortgage accounts are available separately. Please see our Mortgage account tariff page, call into your local Branch or telephone our Customer Services Department on 0845 130 5206† for a copy.
Customer care
The Society is committed to providing the highest standards of customer service and care. If at any time you feel that our standard of service falls below that which you would expect, we will make every effort to handle your complaint fairly, effectively and promptly and resolve it at the earliest opportunity through our Internal Complaints Procedure. Our leaflet titled “Our promise to you” sets out our Complaints Procedure and this is available on request by telephoning our Customer Services Department on 01723 368 155†.
†Telephone calls may be monitored and recorded for training purposes, security, and for your protection. Lines open between 08:30 - 18:00 Monday to Friday and 09:00 - 12:00 Saturday.