HUNDREDS of people are out of pocket by thousands of pounds because of delays at the main sorting office in Sussex.

Royal Mail is now launching an investigation after applications for TESSA and PEP accounts arrived too late to meet their April 5 deadline.

Financial group Legal and General says about 800 letters arrived from April 6 onwards at its Redhill office after being sent via the Gatwick sorting centre on Crawley's industrial estate.

The company says dozens of people from the BN and RH postcode areas of Sussex alone are likely to have been affected by the delay.

Spokesman Sarah Kingham said the company accepted people who posted on April 3 and 4 might have expected to be too late, but many of the letters were sent first class at the end of March.

She said: "We would have thought that letters sent out on those days would have arrived on time.

"As it is a lot of people have lost out on thousands of pounds worth of investments and now it is too late.

"We contacted the Inland revenue to see if there could be any extensions, but they said there was no chance. We needed to prove that we had received the application by April 5, and if wecouldn't then that was too bad."

Legal and General says it was expecting a last-minute rush of applications to open the tax-free accounts, and because the deadline fell over the Easter holiday it contacted Royal Mail to see if it could make special trips to the Gatwick sorting office. But it was told it was not permitted.

Royal Mail spokesman Bryan Kirkwood said an investigation had now been launched into the delays.

He said: "We are looking into the situation to see exactly what happened. We take all complaints about customer services and delivery very seriously and every effort will be made to establish how this situation arose.

April 5 was the last chance investors had to invest in the PEPs and TESSA tax-free accounts which have a maximum investment of £9,000.

Both schemes have now been replaced by the Individual Savings Accounts, ISAs, which have a maximum investment of £5,000.

The Legal and General problems are the latest in a series of teething troubles for Royal Mail, including complaints about delivery hold-ups in Crawley, as sorting offices across Sussex are relocated to the new purpose-built sorting office at Gatwick.

The move is expected to be completed by the end of the month.

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