WHY are the sellers of endowment mortgages the only people who defend them?

Possibly it is the fat commission they pay - up to five times that for repayment mortgages. Three out of every four endowments are surrendered before maturity - usually at a great financial loss.

They are an inflexible gamble on how the stock markets will do in 10 or 20 years time.

Their past tax advantages have gone and the Institute of Actuaries forecast that returns on a typical endowment will halve over the next 10-15 years - not increase as many sellers claim.

There are some satisfied customers of policies taken out 25 years ago, but there are many heart-breaking cases of financial ruin. Two new ones in my post today are people whose endowments will not mature until they are in their late seventies. That's mis-selling.

There are many others who deserve compensation.

Endowments are only one part of the mortgage mis-selling scandal. Regulation is essential to end the rip-offs of lock-in interest rates, vast redemption charges, compulsory expensive insurance, MIGs and interest rates repeatedly rigged in favour of the lenders.

Most endowments are now sold by so-called independent financial advisers and not directly by major institutions.

Pension mis-selling and mortgage selling are the result of a foolish system in which the adviser is also the commission-seeking seller.

The long term answer is to provide genuinely independent financial advice that is entirely separate from dependence on commission from selling.

PAUL FLYNN (MP for Newport West), House of Commons, London SW1.

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