My parents were swindled out of £250,000 life savings in Philips Trust building society scandal  – we’re all suffering 

PULLING back the hospital curtain at her father’s bed just days after he had suffered a stroke, Tracey Steedman was horrified to find two strangers speaking to her parents.

The now 53-year-old from Wallsend, Tyne and Wear, had no idea her mum and dad were in the process of being swindled out of their £250,000 life savings – and that she would still be fighting for them over a decade later.

Assisted living warden Catherine and her husband pipe-fitter William Burton, 63, were among the thousands of building society customers who lost money in the Philips Trust scandal.

Tracy, council housing officer, said: “One day in September 2012, Mum went into her Newcastle Building Society branch to deposit money, like she did every month.

“The cashier asked if she had a will, which she did. They then recommended mum speak to their will-writing company to make sure everything was in place and mum was secure.”

A few days later, representatives from The Will Writing Company visited 61-year-old Catherine at home.

They persuaded Catherine to put all her Newcastle Building Society assets and those held elsewhere into a trust fund.

At no point did the reps reveal they weren’t from the building society, but a separate company.

But before the couple could sign the contract, William suffered a stroke.

Tracy said: “ I took a few hours off work to see dad, only to find the curtains drawn. When I opened them, Mum was sat there with two people from The Will Writing Company. It was barbaric.

“I asked them to leave. Dad, in his state, was questioning whether they were not supposed to be here. I said absolutely not.

“It was inhumane to have a man sign in that way. They clearly thought he was going to die. I was horrified.”

When William died two years later, questions were raised about the signature obtained in the hospital.

Tracy said: “My mum was one of those people who, if you had a nice smile, she’d hand you her life savings.

“She trusted Newcastle, having banked with them for years, so she was willing to write to HMRC stating she was present when the contract was signed.”

Fortunately, the concerns Tracy and her brothers had about William’s trust funds did not result in problems after his death.

The couple’s home was in Catherine’s name only, and the value of his bonds had grown. They were sold for £90,000 before reaching maturity.

If things ran relatively smoothly after William’s death, it was a different matter when Catherine died in 2021, age 71.

The family were able to sell Catherine’s house for £150,000 without too much trouble, but tackling the assets proved trickier.

Tracy was told that she would need to wait until March 2024 before her mother’s bonds matured, which she knew wasn’t true.

Her father’s bonds had been sold before maturing, and this was the route she and her brothers instructed the company to explore.

It was just awful to know [mum] had scrimped and saved all her life, and it was just gone

Tracey Steedmandaughter

“I sent a copy of the death certificate, the will and a letter of our wishes. This was signed for at their offices, but then it all went quiet, no one would answer their landlines, and mobiles went unanswered,” she said.

“My brother asked a friend to go to their offices, where a security guard confirmed no one had been there for months.”

Tracy estimates her mother’s bonds are worth around £250,000 and is still not convinced she and her brothers will ever see a penny of it.

She said: “When mum died, I had six months off work because of this. I just broke because I’d lost my mum and then potentially lost everything she’d worked for.

“It was just awful to know she had scrimped and saved all her life, and it was just gone.

“Mum asked me to put her ashes on her parents’ grave, but they’re still in my sitting room. I can’t do it until I feel I’ve done right by them.”

The couple are just two of the thousands of building society customers who have been affected by the scandal.

The building societies earned up to 20% commission for introducing customers.

But in 2018, the Family Trust Corporation went bust and a third party called the Philips Trust Corporation took over.

Customers’ money was moved from sound investments and put into new vehicles before going bust in April 2022.

In May this year, Leeds, Newcastle and Nottingham building societies announced that they will reimburse over 2,000 customers who placed money in the now-failed trusts.

It means that Tracy now has some home that the money will be returned.

Labour MP for South Shields Emma Lewell-Buck believes lessons must be learned from this scandal.

“People in my constituency of South Shields and across the country poured their hard-earned life savings into schemes promoted by building societies they trusted,” she said.

“It’s outrageous that the building societies involved in this scandal did not conduct adequate due diligence before recommending unregulated third parties, without warning customers of the risks.

“I believe The Will Writing Company targeted people whose properties were paid for and were sitting on substantial assets, and let’s not forget these are older people, who trust their banks.”

Lynn Parsons, of the Philips Trust Action Group, added: “If the building societies want to restore their integrity and our trust in them as mutuals, we would like to see all victims treated fairly.

“All entry and exit costs and associated losses caused by these trusts need to be returned, along with professional fees and associated HMRC costs.”

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