London Capital and Finance

Reaper

Let's not stir things up again. Dunstonh was allowed back and the newish user changed his posting style.

robatwork

AnotherJoe wrote: »

Who was that ?

verybigchris wrote: »

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

This ^^^^^

jimjames

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.

Maybe I'm expecting too much but someone who has studied for at least 3 years to gain a chartered status should be able to do far more than check numbers add up.

I truly believe that anyone who claims they are a chartered accountant with 20 years financial services experience in investment and corporate banking has absolutely no excuse for putting money into a company such as LCF. If ordinary folk on here can spot something was wrong then those with that sort of experience should have noticed a mile off.

All the signs were there and I'd fully expect an accountant to see that the accounts showed the black hole and the lack of solvency let alone question how 8% was even possible for a company to guarantee. I suspect some of those now claiming ignorance were aware it was risky and are now jumping on the bandwagon to get money back.

Malthusian

jimjames wrote: »

Maybe I'm expecting too much but someone who has studied for at least 3 years to gain a chartered status should be able to do far more than check numbers add up.

I truly believe that anyone who claims they are a chartered accountant with 20 years financial services experience in investment and corporate banking has absolutely no excuse for putting money into a company such as LCF.

"Outside the laboratory, scientists are no wiser than anyone else."

There are people with the job title "scientist" who believe that Jesus rose from the dead on the third day. When they are being paid to use the scientific method they use the scientific method. When they go home they discard the scientific method like their lab coat and shoes.

Yudkowsky wrote:

Suppose that an apprentice shepherd is laboriously trained to count sheep, as they pass in and out of a fold. Thus the shepherd knows when all the sheep have left, and when all the sheep have returned. Then you give the shepherd a few apples, and say: "How many apples?" But the shepherd stares at you blankly, because they weren't trained to count apples - just sheep. You would probably suspect that the shepherd didn't understand counting very well.

Now suppose we discover that a Ph.D. economist buys a lottery ticket every week. We have to ask ourselves: Does this person really understand expected utility, on a gut level? Or have they just been trained to perform certain algebra tricks?

There are many many chartered accountants who will go into their office and analyse the state of a company's finances and ask all the right questions of the directors and then write the correct conclusion in their report, and make a living for doing so. But they do not really understand corporate finance, they have just been trained to perform tricks with company accounts.

When they see an advert for LCF they don't head for Companies House and start analysing its accounts. They're outside the laboratory now, they're not wearing their chartered accountant suit with the chartered accountant tie. So they just say to themselves "It's FCA regulated and it's backed by property so it can't go wrong".

Naturally a good chartered accountant would not do this. But 90% of chartered accountants are crap, per Sturgeon's Law.

The good chartered accountant does not just understand how to analyse company accounts but why you analyse company accounts. The crap chartered accountant doesn't know why. They are just a trained monkey doing tricks that they've been laboriously trained to perform by the ICAEW and their employers.

Yudkowsky wrote:

Why should you test your hypothesis experimentally? Because you know the journal will demand so before it publishes your paper? Because you were trained to do it in college? Because everyone else says in unison that it's important to do the experiment, and they'll look at you funny if you say otherwise? No: because, in order to map a territory, you have to go out and look at the territory.

Why should you analyse company accounts? Because it's your job? Because it's a ritual you have to perform before you sign them off as "true and fair" and collect your fee? Because the senior partner will be cross if you don't bother? No, because people rely on the company's accounts to decide, for example, whether or not to extend the company credit, amongst various other reasons that require good-quality information about the company's finances.

But a crap accountant analyses company accounts because it's their job. When they're at home looking at an LCF investment it's not their job right now, so they don't bother and content themselves with "it's backed by property and it's FCA-regulated so it can't go wrong".

"Not bothering" isn't even an accurate description; that implies their brain goes "Analyse LCF's full management accounts before lending money, y/n?". It literally does not occur to them at any point that they should analyse LCF's accounts. Analysing company accounts is a ritual they perform at work. They aren't at work. Their day goes "8am eat breakfast, 9am-5pm analyse company accounts, 6pm relax". They're looking at the Surge advert after 6pm so they're not analysing company accounts right now. It's not part of their learned pattern of behaviour.

It would no more occur to them that they should start analysing company accounts after 6pm than it would occur to my cat to start taking a dump in the middle of eating her dinner. Taking a dump is what you do at 7.15am in the litterbox, analysing accounts is what you do from 9-5 in the office.

None of this is a justification for chartered accountants losing their money in LCF or suggesting it's not their fault. It is. But you and others expressed confusion over how a chartered accountant could invest in LCF and this is why it is not confusing.

Regular contributors to this thread - the people who could see what was coming - aren't ordinary folk. They understand both the how and why of analysing company accounts which puts them above 1% of the population and above the 90% of performing monkeys trained by the ICAEW to do tricks with company accounts.

bail-in

Wow! Santa has come to visit LCF investors!

https://www.express.co.uk/finance/personalfinance/1211255/ISA-news-scandal-London-capital-and-finance-collapse-pension

AnotherJoe

verybigchris wrote: »

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.

Ah, that poster with his wholly counterproductive posts I do recall

jimjames

Malthusian wrote: »

But a crap accountant analyses company accounts because it's their job. When they're at home looking at an LCF investment it's not their job right now, so they don't bother and content themselves with "it's backed by property and it's FCA-regulated so it can't go wrong".
None of this is a justification for chartered accountants losing their money in LCF or suggesting it's not their fault. It is. But you and others expressed confusion over how a chartered accountant could invest in LCF and this is why it is not confusing.

That certainly makes sense. I'd also say that some of the CVs quoting their finance industry experience as a reason to be on the Creditor Committee should have the opposite effect, if they couldn't use their experience to spot the issues then that should rule them out from being selected.

Those investors might need to consider GDPR/privacy too, some have put a lot of personal data in their public profiles which could leave them at risk of fraud

jimjames

bail-in wrote: »

Wow! Santa has come to visit LCF investors!

https://www.express.co.uk/finance/personalfinance/1211255/ISA-news-scandal-London-capital-and-finance-collapse-pension

Old news. One it's interim payment but more importantly it's not being paid before Christmas due to some legal issues.

jimjames

Another twist in the LCF saga, the High Court has agreed that the trustees GST can be removed from acting for bondholders of LCF.

http://www.bailii.org/ew/cases/EWHC/Ch/2019/3339.html

GST has no assets and was essentially a non trading, dormant company so quite how it has any funds to launch legal action at the High Court raises more questions. This was even raised in the judgement as a query about who was funding the legal work.

https://damn-lies-and-statistics.blogspot.com/2019/12/gst-where-money-coming-from-lcf.html

Reaper

I don't think the web site with the questionable name on the blog post is a ploy by LCF. I think it is an investor with little knowledge ranting and seeing conspiracies where there are none.

The court case link was interesting. GST sounds very much like LCF with linked members and a similar disregard of good business practice. While not core this bit made me chuckle:

Mr Friedlander does not accept that he is not a suitable director... he does not consider his resignation to be necessary and he points to the assistance he is able to provide in connection with attempts to recover the debt due from Prime. Curiously, he then says he has entered non-disclosure agreements with Prime which prevent him from providing more than the outline information contained in his statements.

i.e. he can be very useful providing information about Prime therefore he should be kept on - even though he isn't actually able to provide any more information about Prime. Mind boggling. Do they actually hear what is coming out of their mouths?