The 5th Anniversary

Thursday 19th September 2009 was the date we'd expected to receive back, 100% of the money we transferred from our BNP Current Account into a "5%, 5 year, 100% guaranteed" product, 5 years earlier. In the two months prior to transferring the money, we'd suggested other products BNP had advertised, but the Branch Manager, Moises Erades, advised against them "because they've all gone" or "because there is a risk".

When we'd asked, in the Autumn of 2008, what the penalty would be to redeem 50% of the money, Moises told us it was impossible, as we could not touch the money until the end of the 5 years. A year later he claimed it had always been a 'perpetual' product and he had no idea why we thought we'd get 100% of our money back in 5 years, with 5% interest.

In March we asked to borrow against the security of the money, so that we could take advantage of a 'stress sale' of a property along the coast that offered a 50% discount, Moises wrote back:

From: 2101-Jávea(Moises Erades Sart)
Date: 3 de març de 2009 9:23:16 GMT+01:00
To: "Clive Read"
Subject: RE: PRESTAMO

Hola Sr. READ:

He pedido autorización a los servicios centrales:
Cuando tenga respuesta se lo comunicaré.
Saludos.

which, in English, told me
I requested authorization from headquarters:
When they answer I will communicate.

6 months later, and with many visits to ask for news, there is still NO DECISION.

We asked Moises on 3rd September to request permission for "a line of credit" to tide-us-over until we COULD get our money back and he said we'd know in a week. I called a week later but he had no news and said he would contact me when there was a decision. It was agreed that his bank would tell us HOW MUCH credit they were permitted to grant.

BNP's Manager mis-sold us a product as "5%, over 5 years with 100% Guarantee" that was NONE of those things.

5% is not 5% and 5 years in forever with NO Gurantee

On Wednesday (2nd September) we met with Moises, the Manager. On the previous day Luis, the Investment Adviser said he would be present, but he was kept outside of Moises's office during our visit.

I asked Moiseswhether the 451,000 we'd transferred to BNP in September 2004 would be returned on 17th September 2009 - the end of the 5 year term, but Moises said "No" because their value was too low and, in any case, it was not a 5 year term.

I showed him my eMails, and one he'd received on our behalf from Enrique Castellanos, a Spanish friend in Valencia and former Director of one of Spain's most important banks, dated:

3rd February 2009
26th February 2009
12th March 2009 (in Spanish fro my banker friend)

all of which referred to "5% for a 5 year term" and asked why, if it was not a 5 year term, Moises hadn't replied to Enrique and I and pointed out our misinderstanding. Moises shrugged his shoulders.

When we wrote to Moises and then saw him a year ago and asked what the penalty was if we redeemed some of our shares early, as we needed the money, he said that we could not sell until September 2009, which was the end of the 5 year term.

We wonder why he is changing what he is telling us?

In 2004 we were told "5% over 5 years with 100% Guarantee return of 451,000 on 17th September 2009"

and yesterday, when I was suggesting that if there had been a profit - and the product had risen to 160% - BNP would have kept the profit so why should BNP not make the loss, Moises told us that if the value had risen to 160% we would have been paid out 721,600 Euros. (Plus we'd have been receiving 5% interest every 6 months): a total of 834,350 Euros!!

We bought on the basis that we would get 5% plus our MONEY BACK - no more and no less. No profit - no loss.

What is the TRUTH about what we would have received if the Nordea Bond now stood at 160% of its September 2004 value and we decided to sell?

Moises said he would apply for 'credit' on our Banco Gallego account, against the security of the 451,000 and would have a decision within about a week. He said we would incur an arrangement fee cost of 1,500 Euros and 500 for the Notary. We thought that was a lot to pay to borrow money to which we thought we'd be entitled in 3 weeks time. I asked what had happened to the application he said he'd made in March, and to which I'd had no decision. Again, Moises shrugged his shoulders.

When I arrived back home, I found a graph from Nordea indicating that the investment recommended by Moises in September 2004 had consistently dropped in value since 2 months after we invested, and had dropped as low as 22 cents in the Euro. It was currently trading at 67 cents.



I phoned BNP Paribas in Madrid, who told me that had I put my money into BNP Protected Plus F.I. the 451,000 Euros would not have paid us any interest, but instead of losing 33% of its value, it would return - at today's level - 487,000 Euros. It would have gained 8.36% over the term - or 1.7% a year - rather than the currentlv 30% LOSS on the investment recommended to us by Moises as being WITHOUT RISK.

We checked on the interest we'd received on our 451,000 Euros and discovered that we'd never received the expected 22,550 each year, and wonder if the 5% guaranteed interest was based on the actual value of the money during the 5 years, rather than the amount we'd transferred. We'd thought that 5% a year on 451.000 Euros over 5 years would be what the words say.

We'd always had good service and a reasonable return on the many BNP funds in which we had placed our money, and with so many GOOD, RELIABLE and STABLE BNP products, we wonder why Moises recommended us to Nordea, which has been in perpetual decline until the March crash, but is now recovering?