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  • FIRST POST
    • agarnett
    • By agarnett 11th May 17, 5:42 PM
    • 1,143Posts
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    agarnett
    Oh ... so FCA decided in 2015 that Aviva Investors Global Svcs Ltd peeps were crooks!
    • #1
    • 11th May 17, 5:42 PM
    Oh ... so FCA decided in 2015 that Aviva Investors Global Svcs Ltd peeps were crooks! 11th May 17 at 5:42 PM
    Just stumbled upon this.

    And in the middle of the first few pages I read this:
    4.7. Aviva Investors’ policy required trades to be allocated to specific funds at the time of, or immediately after, the order. However weaknesses in Aviva Investors’ systems and processes (see paragraphs 4.16 - 4.17 below) meant Traders could delay recording the allocation of executed trades for several hours. By delaying the allocation of trades, Side-by-Side Traders could assess a trade’s performance during the course of the day and, when it was recorded, allocate trades that benefitted from favourable intraday price movements to one fund and trades that did not to other funds. For example, a Side-by-Side Trader could buy an instrument at 9 am intending to allocate it to the Hedge Fund, but by 3 pm, seeing that the instrument had fallen in value, allocate it to a Long-Only fund. This is commonly known as Cherry Picking.
    Now I don't recognise that as Cherry Picking. I recognise that as actual fraud.
    Am I wrong?
    Did anyone go to jail?

    I believe this concerns me directly because I think I own Aviva policies with funds managed by the company in question.

    Should I and other Aviva customers be concerned?
Page 1
    • dunstonh
    • By dunstonh 11th May 17, 6:09 PM
    • 87,693 Posts
    • 52,919 Thanks
    dunstonh
    • #2
    • 11th May 17, 6:09 PM
    • #2
    • 11th May 17, 6:09 PM
    so FCA decided in 2015 that Aviva Investors Global Svcs Ltd peeps were crooks!
    The FCA does not have that power.

    Did anyone go to jail?
    Only a court can decide that and the FCA did not instigate any legal action.

    The traders were taking advantage of lax systems and controls and what they did was not illegal. It was a regulatory breach. Market abuse can be at the legal level or regulatory level. Its not all illegal.

    I believe this concerns me directly because I think I own Aviva policies with funds managed by the company in question.
    And the 8 funds affected were compensated. It was at fund level. Not product level.

    Should I and other Aviva customers be concerned?
    No. It proved extremely costly to Aviva and changes were put in place which the FCA are happy with. Sometimes you are better off being with the one that got caught and made an example of rather than the ones that were doing the same thing elsewhere but didnt get caught and were able to change before they were.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
    • agarnett
    • By agarnett 11th May 17, 6:25 PM
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    agarnett
    • #3
    • 11th May 17, 6:25 PM
    • #3
    • 11th May 17, 6:25 PM
    I read further that this practice that resulted in the FCA fine related to a period of several years, but that the compensation made to the affected funds was just £132 million.

    I have further realised that the this Aviva subsidiary is indeed or was at least in 2013 "the main Discretionary Fund Manager (the'Fund Manager') of the Fund in which my Section 32 pension policy is invested - the Aviva Life & Pensions UK Limited Old With-Profits Sub Fund (and New With-Profits Sub-Fund) and I assume, that means they are the Fund Manager for the approx. £3BN inherited estate which Aviva conned away from most policyholders (not me - but most of yours based on opinions you published at the time - 2009?).

    That meant that there are Sub-Funds which I do not have an interest in but which Aviva do have an interest in directly. Was my Sub-fund discriminated against by the crooks in favour of funds in which Aviva shareholders had an interest?

    Goodness knows how big the whole WP Fund is that I am invested in, but no doubt £132million is a fart in the wind over several years of management of a multi-billion pound fund.

    Sometimes you are better off with true transparency in financial services rather than the very murky pools Aviva and others create deliberately.
    • Malthusian
    • By Malthusian 11th May 17, 10:32 PM
    • 1,981 Posts
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    Malthusian
    • #4
    • 11th May 17, 10:32 PM
    • #4
    • 11th May 17, 10:32 PM
    I read further that this practice that resulted in the FCA fine related to a period of several years, but that the compensation made to the affected funds was just £132 million.
    Originally posted by agarnett
    What have you calculated the total compensation due to be? Show your working. [8]
    • agarnett
    • By agarnett 11th May 17, 11:07 PM
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    agarnett
    • #5
    • 11th May 17, 11:07 PM
    • #5
    • 11th May 17, 11:07 PM
    Are you just another industry obfuscation expert, Malthusian? Or just one who is alright Jack and feels they can hold their own against the big boys and never mind the rest? Where's the public good in your comment?
    • Triumph13
    • By Triumph13 12th May 17, 9:00 AM
    • 981 Posts
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    Triumph13
    • #6
    • 12th May 17, 9:00 AM
    • #6
    • 12th May 17, 9:00 AM
    The public good is in not letting a random 'finance industry are all crooks' statement go unchallenged. If you do that you end up with people keeping their cash under the mattress.
    Weak controls allowed some unscrupulous traders to mildly cook the books. The FCA stopped this, because that is what they are for and calculated how much the impacted funds needed to be compensated by. Everyone now knows that they have to have controls to prevent this kind of thing happening again.
    If you genuinely have information to show that the FCA underestimated the amount of compensation and that Aviva customers have been hard done by or, as you seem to imply, continue to be then please share it.
    • Malthusian
    • By Malthusian 12th May 17, 9:16 AM
    • 1,981 Posts
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    Malthusian
    • #7
    • 12th May 17, 9:16 AM
    • #7
    • 12th May 17, 9:16 AM
    Are you just another industry obfuscation expert, Malthusian? Or just one who is alright Jack and feels they can hold their own against the big boys and never mind the rest? Where's the public good in your comment?
    Originally posted by agarnett
    1/8. If you don't know the answer you should at least give it a go, you might pick up marks for correct technique or working.
    • woolly_wombat
    • By woolly_wombat 12th May 17, 9:32 AM
    • 453 Posts
    • 264 Thanks
    woolly_wombat
    • #8
    • 12th May 17, 9:32 AM
    • #8
    • 12th May 17, 9:32 AM
    Are you just another industry obfuscation expert, Malthusian? Or just one who is alright Jack and feels they can hold their own against the big boys and never mind the rest? Where's the public good in your comment?
    Originally posted by agarnett
    Seen it all before on other sites/forums re Equitable Life.

    Folks going to great lengths to make out that all was fine and rosy when it clearly wasn't.
    • agarnett
    • By agarnett 12th May 17, 10:03 AM
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    agarnett
    • #9
    • 12th May 17, 10:03 AM
    • #9
    • 12th May 17, 10:03 AM
    Yes you are so right W_W.

    There's two sorts - weak brains who have built their own wealth hanging on the apron strings of the rotten financial services culture that has developed over three full decades now, plus others I feel more sorry for who really can't believe so many in the industry can be so corrupt, and want to believe in the good in most people, but the culture went viral. Even the quiet spoken head down grafters say nothing from inside when they come across obvious corruption. They have their pensions to worry about after all!

    Everytime I speak to Aviva employees I remind them that my pension scheme is propping up their's through regular raids on the inherited estate.

    But it is much worse than that, as this FCA case shows.

    FCA are nothing more than very questionable negotiators with crooks on behalf of HMG i.e. we know you've been crooked so would you please stump up X million for the FCA benevolent fund so we can let you continue business as usual. Who is the the stronger party? Bent police or organised crime? It is a valid analogy.
    • eightfoot2
    • By eightfoot2 12th May 17, 1:59 PM
    • 6 Posts
    • 0 Thanks
    eightfoot2
    this thread is quite well timed as I'm not really up on pension but was sorting some paperwork out last week and came across a letter from Aviva dated 18mths ago
    long story short,had s/e pension with Hamilton life was taken over by Aviva some time ago always got annual statement showing value these stopped in 2012 didn't really bother about chasing them up,now on to this letter from 18mths ago it states they have identified some "irregularities" with the value of the policy and as a result have added extra units to my policy,now there is no explanation as to what went wrong so I phoned Aviva on Monday to find where my statements had got to and could they explain to me what had gone wrong so I could decide if I have been fully re embursed,only explanation they would give me was "the units performed better than they expected so units where added to show this" (sound wrong to me) but they said the only way I could possibly get more info was to write requesting an explanation
    so my question is could this be what the o/p was referring to regarding crooks or does someone know what direction to point me in tofind more info on this thanks
    in for a penny
    • GarthThomas
    • By GarthThomas 13th May 17, 7:21 AM
    • 150 Posts
    • 220 Thanks
    GarthThomas
    Are you just another industry obfuscation expert, Malthusian? Or just one who is alright Jack and feels they can hold their own against the big boys and never mind the rest? Where's the public good in your comment?
    Originally posted by agarnett
    It sounds as though you may be better off staying away from financial companies with your investments and pensions. It's easy enough to do, you take your wages and put the spare in a box, or set up your own company with it.

    I don't take that route, as I don't agree with your outlook, I'm a busy worker, and am happy to let others rebalance my holdings for me, and know that the FCA does a pretty good job (I'm subject to them, so am well aware of what they do) but if you aren't happy with them then it's better to step away from financial services entirely and take care of your money yourself.
    • agarnett
    • By agarnett 13th May 17, 12:05 PM
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    agarnett
    It sounds as though you may be better off staying away from financial companies with your investments and pensions. It's easy enough to do, you take your wages and put the spare in a box, or set up your own company with it.

    I don't take that route, as I don't agree with your outlook, I'm a busy worker, and am happy to let others rebalance my holdings for me, and know that the FCA does a pretty good job (I'm subject to them, so am well aware of what they do) but if you aren't happy with them then it's better to step away from financial services entirely and take care of your money yourself.
    Originally posted by GarthThomas
    Yes you fit nicely into one of the two classic types I mentioned, Garth. Work hard, keep your head down, don't get caught crossing any obvious FCA boundaries in your area within their jurisdiction - not alone anyway, and above all make money - oh sorry - I meant garner wealth, didn't I?

    It's funny, I always thought real wealth was created from original ideas and creating and making things. Strange thing is that so many of us, especially in UK, find ourselves working in financial services. It's not exactly normal, and it's actually a rather narrow area within which to demonstrate creativity. In it, there's your money, and there's other people's money. The trick is making yours grow, and those on the same team perhaps, isn't it? At whose expense, though ? What do they get in return for your 'services' other than a reduced balance? Reduced risk perhaps? Or something less well bounded?

    I do not advocate putting cash in a box under your bed. I do advocate putting scapegoated crooks and their slippery bosses in jail.

    And above all I advocate transparency - not just in financial services companies themselves but in the regulation of them. Currently FCA are not much better than bent cops raking off a take. Where do the fines go? To pay for their awayday shindigs for FCA staff?

    Why in that FCA case report is there not at least a list of names of those eight affected funds and an indication of the numbers of investors affected in each, and a breakdown of the £132M apparently compensated and when and by what means?

    Why does eightfoot2 have to come here and ask US if the Hamilton Life funds were among those affected?
    • agarnett
    • By agarnett 19th May 17, 10:47 AM
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    agarnett
    Just read last night how piffling the FCA fine was against one of the traders involved in the Cherry Picking fraud.

    In a period where a crook named Miah from Luton, a trader who said he was trying to enhance his reputation as some kind of trading golden boy so he could land himself "Fund Manager" title (and remuneration no doubt), was fined £140K which was £200K with a 30% discount ...

    During the 22 month period where he was regularly cooking the books he received over £800K in remuneration. That's during a typical period where a bank cashier might have expected to receive £30K.

    He'd been working at Aviva since 2001, so no doubt was completely imbued with the culture that the head honchos there inculcate in their staff i.e. "getting away with it", plus I bet he is in the Aviva Staff Pensions Scheme which my Aviva WP Pension regularly props up.

    The fine was thought to be a suitable deterrent by FCA. FCA are laughable. So where can I visit and see him and his bosses, all line up nicely deterred and totally remorseful, hanging by their b¤lls and/or unspeakables on a string then?

    And where do I read that his pension is annulled and an appropriate pension Transfer Value has been refunded to the inherited estate in my With Profit fund?

    And I found the report of his fine on fca.org.uk covering his 22 months of continuous daily fraud, but we know that the system was exploited over a much longer period, maybe 2005 to 2013 so where are the other reports of individual misdemeanours? Or was Miah just being eased out anyway and this was the cheapest way for Aviva to do it - make him a scapegoat and then cook the books in 8 unnamed Aviva funds some more and tell the little people that the money has all been put back?

    I am sorry to say, I have seen exactly that before in the City. The real big crooks get away scot free, don't they, ex-pat scot?
    • GarthThomas
    • By GarthThomas 19th May 17, 7:21 PM
    • 150 Posts
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    GarthThomas
    It's a bit hard to follow your postings, as you do ramble a bit (are you getting on in life?), but your point about wealth coming from creating and making things is a bit silly. Wayne Rooney doesn't create or make anything, top surgeons, formula 1 drivers, or in-demand plumbers don't create or make either.

    It's similar with me; I get paid for selling services that my clients want. They have complex needs (they are major corporations), and have risks that they have no interest in retaining.

    For example, utilities who are allowed to raise their prices in line with inflation. They have no business being exposed to the vagaries of inflation linked bond yields, so come to me for a hedge. I can then aggregate this risk and sell it on in a bit of a different format to insurance companies who have sold inflation linked annuities. The business is valuable to both sides, so each will pay me a hundredth of a percent per year or so, which adds up to nine or ten figures a year in profit. I bet given a smallish share of that.
    • agarnett
    • By agarnett 20th May 17, 9:16 AM
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    agarnett
    So! you are a wheeler and dealer in hedge fund ideas? Do you often ramble round your own hedges too? Or tear them down and rip them up as fast as dreaming them up and planting them, so the traces are difficult to follow?

    You say your clients have complex needs and risks they have no interest in retaining. What you really mean is that they want their cake, our cake and to be able to scoff the lot too, and you help them get away with it risk free and scot free.

    Wonderful. We get all sorts on MSE don't we, and yes, I am getting on in life nicely thanks. My life isn't based on money or what I did last week, it is based on what I do and what my friends and family do. And we don't screw little people because our maths skills are greater than their's or because we know a bunch of corporate crooks who can bleed little people dry. And I suppose on the day Pippa rear of the year Middleton gets married, we don't get to say our future brother-in-law is a future king?

    In the case that is reported by this thread, it was hedge funds that were being favoured over ordinary investors funds that created the crooked opportunity that Miah and others were exploiting. It was hedge fund and associated wizardry that was largely responsible for the financial crisis in 2008, where even fledgling hedge fund managers just out of short trousers (probably like you) couldn't believe their luck at being handed large 6 figure bonuses one minute - "emerging markets" I recall was one label put on the areas of activity that had been raining money for hedge fund peeps - but then they were themselves running around like blue-Rssd fly-ridden headless chickens trying to find safe government backed FSCS bank accounts in normal retail markets, using FSCS guarantees set up for ordinary people not set up for you, in which to stuff their shares of the swag and wait it out while they worked out how they should spend such disgusting sums of money for just hacking the main system.


    So tell us Garth Thomas - those hedge funds that benefited from the crooked deals at our expense? £132 million was it, supposedly? Is that with or without the sort of leverage your deals can apply disproportionately to any market you fancy given a bit of major corporate support? Did people like you who skim massive bonuses fund the shortfalls in the investor funds that lost the calculated £132M? Or was that all lost in the sands of time by just planting a few more hedges based on insider information on what would happen when FCA announced they were fining Aviva?

    Your gall in coming here to this thread in particular and bragging about how you set out to cream off hundreds of thousands and more of our money (because it is more often ours not your clients) sickens me.
    Last edited by agarnett; 20-05-2017 at 9:19 AM.
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