I can find 8% investments - Am I missing something??

jimjames

dunstonh wrote: »

James, have you thought about sending that to the FCA. They are looking at unregulated investments and how they are marketed at the moment. You may find someone willing to take an interest.

I'll give it another go. Last time they weren't interested and nor were ASA

Malthusian

dunstonh wrote: »

James, have you thought about sending that to the FCA. They are looking at unregulated investments and how they are marketed at the moment.

Can you elaborate? I can't see any reason for the FCA to take action in the Facebook ad.

There appears to be no regulation on promotion of unregulated corporate loan notes and as the investment itself is unregulated, it's essentially not the FCA's problem.

We've just seen with Park First that if you do run an unregulated collective scheme, which is the FCA's problem, the FCA will helpfully allow you to restructure the investment so it isn't their problem any more. Then take no further action.

As far as I can see, the FCA's general attitude to unregulated investments is "not our problem". So I would be very interested to know if something else is going on behind the scenes.

dunstonh

Can you elaborate? I can't see any reason for the FCA to take action in the Facebook ad.

Unregulated investments have restrictions on how they can be marketed. If they are being marketed in a way that makes them appear like a normal retail deposit, when it cannot be right.

It was at an FCA roadshow meeting that it was mentioned that they were looking at unregulated investments more closely than previously. However, the audience was mostly IFA. So, it may be that is the extent of their view.

Malthusian

Most of the regulation on promotion of unregulated investments seems to focus on unregulated collective investment schemes, and corpoate loan notes aren't considered a collective investment. (Which is nonsense, but that's UK securities law for you.)

The only way the ad in this thread could be said to make them appear like a normal retail deposit is the reference to savings, and that's tenuous.

More to the point, the FCA's prior action on Park First suggests even if it finds that Blackmore's adverts are misleading, the only action it will take will be to tell them to change the adverts. Rather like how the only action the ASA ever takes is to say "the advert must not appear again in its current form" (after the business has already reaped the rewards of showing the illicit advert).

dont_use_vistaprint

They loan your money in large amounts to established UK companies with asset protection, unlike funding circle, that loan to A-D rated with no assets. Rather than track payments/defaults online you call them to see how it's doing. So its like P2P but on a much bigger scale. There published accounts suggest lenders do not default

Malthusian

dont_use_vistaprint wrote: »

So its like P2P but on a much bigger scale.

No, it's on a much smaller scale. Funding Circle, just to pick the one you mentioned, has outstanding loans of £1.6 billion. LC&F claim a loan book of £103 million.

There published accounts suggest lenders do not default

Borrowers default, not lenders. Pedantry aside, that's not very reassuring. Borrowers do default, otherwise LC&F wouldn't need to charge them interest and therefore wouldn't be able to pay up to 8% per annum to their own lenders.

Their last accounts are from April 2016 when LC&F was a much smaller outfit (loans of £10 million according to those accounts) so there is very little they can tell us about the current creditworthiness profile of their borrowers.