London Capital and Finance

masonic

Botheredin wrote: »

So, if all the common directors are sitting on the same companies and those values of assets assigned to those companies has been overinflated to cover the interest /commission amounts what then?

Other than the common directors also being associated with the business who writes the loans, that's a pretty normal situation in the murky world of P2P. I could fill the next few pages of this thread with examples of *cough* professional RICS chartered surveyors and other valuers who cooked their valuation to meet the target LTV of a loan, when in reality there was clear evidence the asset was worth much less. Of course, valuations will contain "assumptions" that get the valuers off the hook in any indemnity claims, and the loan writer can hide behind the independent 3rd party valuation by a qualified and professional individual.

Botheredin

masonic wrote: »

Other than the common directors also being associated with the business who writes the loans, that's a pretty normal situation in the murky world of P2P. I could fill the next few pages of this thread with examples of *cough* professional RICS chartered surveyors and other valuers who cooked their valuation to meet the target LTV of a loan, when in reality there was clear evidence the asset was worth much less. Of course, valuations will contain "assumptions" that get the valuers off the hook in any indemnity claims, and the loan writer can hide behind the independent 3rd party valuation by a qualified and professional individual.

So, in essence 14,000 "investors" (victims), £236m gone and a handful of guys living the high life? Fair assessment?

masonic

Botheredin wrote: »

So, in essence 14,000 "investors" (victims), £236m gone and a handful of guys living the high life? Fair assessment?

Unfortunately, yes. Some money will be recovered, I expect, but I doubt it will be a substantial amount, and a sizeable chunk will go to the administrators.

System

I wonder if the people who were lead producers (surge) were in it from the beginning and knew they were drawing people into a mess.
I also wonder if the call centre people there actually know what theyre doing .

masonic

Poorlyone wrote: »

I wonder if the people who were lead producers (surge) were in it from the beginning and knew they were drawing people into a mess.

There are links between the companies, aren't there, so Surge can be considered part of the "friends and family" arrangement.

I also wonder if the call centre people there actually know what theyre doing .

Doubtful. I wonder if any of them invested.

Jelli

Botheredin wrote: »

So, in essence 14,000 "investors" (victims), £236m gone and a handful of guys living the high life? Fair assessment?

Sorry if this doesn't add much but there weren't 14000 investors. I think that number relates to the products issued so if everyone did 2 investments then 7000 people were involved. I don't know who first mentioned 14000 but think it was in LCF emails? A lot of people I know did 2-6.

Botheredin

Jelli wrote: »

Sorry if this doesn't add much but there weren't 14000 investors. I think that number relates to the products issued so if everyone did 2 investments then 7000 people were involved. I don't know who first mentioned 14000 but think it was in LCF emails?

In the grand scheme of things does it really matter? What appears to have taken place is a group of people stitched together a network f companies and took £236m in which they had every intention of keeping for themselves.

And taxpayers money doesn't buy one iota of protection or redress.

jimjames

Jelli wrote: »

Sorry if this doesn't add much but there weren't 14000 investors. I think that number relates to the products issued so if everyone did 2 investments then 7000 people were involved. I don't know who first mentioned 14000 but think it was in LCF emails? A lot of people I know did 2-6.

The 14,000 has been in various emails but the administrators have now said there are 11,000 bondholders holding approx 14,000 bonds with a face value of £236 million

FAQs appear to have been updated too. Play spot the difference
https://www.londoncapitalandfinance.co.uk/faqs-07.02.19.pdf

https://damn-lies-and-statistics.blogspot.com/2019/02/london-capital-finance-update-whats-new.html

masonic wrote: »

All of the money was lent, but part of the loan was retained by LCF. Essentially the borrower paid for the commission using part of the money lent to it.

What seems really odd is that the administrators immediately spun the line that the loans added up to the bonds and the security was there. It seems a really odd position to take when they haven't looked in detail.

masonic

jimjames wrote: »

What seems really odd is that the administrators immediately spun the line that the loans added up to the bonds and the security was there. It seems a really odd position to take when they haven't looked in detail.

They would have had access to the loan contracts. It would be a relatively simple task to add up the notional value of each loan and compare to the total amount owed to bondholders. Whether they did so, or merely relied on a SOA or unpublished accounts I don't know.

No doubt the administrators wanted to do whatever they could to be reassuring and prevent them getting barraged with calls and emails from worried bondholders. That might have been a grave error.

Malthusian

masonic wrote: »

No doubt the administrators wanted to do whatever they could to be reassuring and prevent them getting barraged with calls and emails from worried bondholders. That might have been a grave error.

It would have been consistent with the administrators' earlier claim on Money Box that it was a good thing that LCF only had 12 borrowers because it gave them less work to do.

Not only does S&W's primary concern seem to be minimising the amount of work they have to do for their fees, but they are quite happy to admit it to investors on national radio.

Making potentially highly misleading statements about the potential for recovery to shut investors up and stop them ringing the office would therefore seem to fit with this strategy.