London Capital and Finance

jimjames

bigadaj wrote: »

MSE fighting for consumers and standing up to rip off artists, not if they receive the whiff of a legal letter. It's a £100 million pound comoany, owned by a much larger price comparison site, but isn't prepared to publish material that could have saved vulnerable people millions, very poor.

What has surprised me when seeing the biogs for the people standing for the creditors committee is how many accountants and professional finance people are amongst them. I wouldn't class someone who is a Chartered Accountant as vulnerable, to me they had no excuses at all for not spotting the warning signs when the number of people on here could see what was happening. With their knowledge they should have seen that the accounts didn't add up and that the money was being loaned to linked non trading companies so it would suggest that they didn't bother to do any due diligence.

masonic

jimjames wrote: »

What has surprised me when seeing the biogs for the people standing for the creditors committee is how many accountants and professional finance people are amongst them. I wouldn't class someone who is a Chartered Accountant as vulnerable, to me they had no excuses at all for not spotting the warning signs when the number of people on here could see what was happening. With their knowledge they should have seen that the accounts didn't add up and that the money was being loaned to linked non trading companies so it would suggest that they didn't bother to do any due diligence.

Are these people really bondholders, or are they representing bondholders?

verybigchris

jimjames wrote: »

What has surprised me when seeing the biogs for the people standing for the creditors committee is how many accountants and professional finance people are amongst them. I wouldn't class someone who is a Chartered Accountant as vulnerable, to me they had no excuses at all for not spotting the warning signs when the number of people on here could see what was happening. With their knowledge they should have seen that the accounts didn't add up and that the money was being loaned to linked non trading companies so it would suggest that they didn't bother to do any due diligence.

I'm a chartered accountant, I have a side job marking accountancy exam papers, and I routinely see people scrape a passing grade who lack any basic common sense when it comes to business and finance. CAs being naive/greedy enough to fall victim to this is just a reflection of the state of the industry right now.

Malthusian

jimjames wrote: »

I wouldn't class someone who is a Chartered Accountant as vulnerable, to me they had no excuses at all for not spotting the warning signs when the number of people on here could see what was happening.

The job of a chartered accountant is to make sure the numbers in column A add up to the same as column B. They are no better at spotting Ponzi scams than a maths teacher, a professional poker player or any other job that involves numbers.

With their knowledge they should have seen that the accounts didn't add up and that the money was being loaned to linked non trading companies so it would suggest that they didn't bother to do any due diligence.

Virtually nobody bothers looking at the Companies House accounts when they invest with FCA-regulated companies. Everyone who's read Vanguard's annual accounts stick your hand up, no cheating.

masonic wrote: »

Are these people really bondholders, or are they representing bondholders?

My understanding is that you have to be a creditor to sit on the creditors' committee, so the former.

AnotherJoe

Malthusian wrote: »

The job of a chartered accountant is to make sure the numbers in column A add up to the same as column B. They are no better at spotting Ponzi scams than a maths teacher, a professional poker player or any other job that involves numbers.

Virtually nobody bothers looking at the Companies House accounts when they invest with FCA-regulated companies. Everyone who's read Vanguard's annual accounts stick your hand up, no cheating.


My understanding is that you have to be a creditor to sit on the creditors' committee, so the former.

Exactly. I was listening to the money program the other day re NPD and there was someone on there been scammed a large amount and he was a financial adviser !

Jeez. Anyway I think its irrelevant and pointless looking through their financial statements because if they are scammers they will look good anyway and its impossible to check teh sources.

The point should be that the unfeasibly large returns and the impossible guarantees, these should suffice to spot a scam / soon-to-fail business just from their adverts. No further digging needed.

Malthusian

AnotherJoe wrote: »

Jeez. Anyway I think its irrelevant and pointless looking through their financial statements because if they are scammers they will look good anyway and its impossible to check teh sources.

Quite. Nobody outside LCF knew that all LCF's money had ended up in crap companies run by the directors until it collapsed and the administrators issued their initial report.

Some will say at this point "what about those Companies House charges that showed all LCF's borrowers were linked to the company". All those told us was that LCF loaned money to other shell companies. What those companies subsequently did with the money nobody knew. For all we knew until January 2019 they on-lent them to hundreds of SMEs with £600m+ of assets as security, like LCF claimed.

99% of people who bang on about LCF investors not having done "due diligence" have never done due diligence on any company they have invested in. Most of them use reputable institutions and mainstream investments so that they don't need to do research.

Around 10% of people do their research, the other 90% just do what everyone else does. They just hope that some of the people they're following are in the 10%.

The point should be that the unfeasibly large returns and the impossible guarantees, these should suffice to spot a scam / soon-to-fail business just from their adverts.

LCF didn't offer unfeasibly large returns and impossible guarantees. Their website and literature made it clear that capital was at risk and 8% pa is not unfeasibly large for capital-at-risk investment.

LCF's adverts misled people about the inherent ultra-high-risk nature of their products but that's not the same thing.

GDB2222

I rang up one of the competitor companies, and it seemed obvious that they were simply making up things on the fly.

I was told that my money would be secured on property worth double the amount of the loan. I asked how that would work, and they tied themselves up in knots trying desperately NOT to say that I was simply handing money over to an unauthorised company, and they could do what they liked with it.

I asked why, if the borrowers had such good collateral, they did not just borrow from the banks? No answer.

They told me that previous investors had been paid in full, which was nonsense as the company was less than a year old, and the minimum bond term was one year.

I think the average investor simply does not expect to be lied to in this way.

robatwork

IanManc wrote: »

I think that the watershed moment was the uproar caused when they banned Dunstonh, and the successful campaign to reverse that decision.

Don't forget that one of the main instigators in getting dunstonh banned, and who didn't lift a figurative finger in the subsequent protest, is still an active poster to this thread.

AnotherJoe

Who was that ? I thought the banning was MSE inspired ? Was it as a result of a complaint because someone didn't like their "investment" being queried? I've met people like that on other forums

verybigchris

AnotherJoe wrote: »

Who was that ? I thought the banning was MSE inspired ? Was it as a result of a complaint because someone didn't like their "investment" being queried? I've met people like that on other forums

IIRC it went something like this:


There was a newish user who made a series of strange posts about LC&F. They were very, very long, had lots of info nobody would ever care about, had content that also appeared on another site and made odd references to having MSE's "permission" to post them, as if they were somehow "official" posts. He/she also failed to engage at all with any of the other posters, never replying or discussing things but just posting these essays then vanishing for a week or two.

This wound up a lot of forumites, who suspected this user might have had ulterior motives. Some directly accused them of defending LC&F which they weren't, but I always felt it was a topic that needed short, clear advice, and any lengthy analysis might make it look like there was something there worth analysing.

Several users were critical of the new poster, myself included. Nothing happened to some, I had posts edited/removed and dunstonh got PPR'd. So it wasn't for comments about LC&F, it was for how they handled another forumite.


I think that's about right, but the first rule of PPR club is you don't talk about PPR club, so who knows.