8% Isa

rscurtis

I have seen an advert from london capital & finance plc , offering 8% fixed isa for 3 years.
Is this too good to be true? Or is it a savings that is not covered by the 85k government scheme ?

Paul_DNAP

It's not a savings account, it is an investment, with an element of risk to it. There is a risk that you will lose all your capital and get back nothing at all if the investment goes wrong. If it goes as well as they expect it to then you will get 8%. If it goes better then they expect ti to you'll still only get 8% and they will keep the rest.


And no, it is not covered by the FSCS.

ColdIron

London Capital and Finance comes up regularly. It's not a cash savings account if that's what you thought, it's an investment product with the potential for 100% loss. Use the search function or read their disclaimer on their web site (my emphasis)

https://www.londoncapitalandfinance.co.uk/disclaimer

LC&F is authorised and regulated by the Financial Conduct Authority, FRN 722603. It should be noted that the bonds offered by LC&F are repaid via loans made to companies and therefore your capital is at risk. Interest payments are not guaranteed if the borrower defaults

Investing in the Bonds carries significant risk and you may lose part or all of your investment

The protections afforded by the Financial Services and Markets Act 2000 including recourse to the Financial Ombudsman Service and compensation entitlements under the Financial Services Compensation Scheme do not apply to the bonds offered

Paul_DNAP

PS. Why is it always new members using their first (and only) post to ask about this account?

fiisch

Last time I posted on a similar thread expressing my opinion, I got a message from the moderators threatening I could be subject to legal action.


Therefore I'll leave it at this: If something seems too good to be true, it usually is.

Wheres_My_Cashback

Paul_DNAP wrote: »

PS. Why is it always new members using their first (and only) post to ask about this account?

Because the finacial forums regularly suffer from trolls/students who are doing course activities for college/uni, posting fictitious scenarios to obtain opinions.

Malthusian

Paul_DNAP wrote: »

PS. Why is it always new members using their first (and only) post to ask about this account?

Assuming good faith would suggest they come across London Capital & Finance while Googling "best interest rates" or similar, and they think that 8% sounds good but alarm bells are ringing, so to get a second opinion they Google something like "money advice" or "savings forum" in which case MSE will come up as one of the top results.

The conspiracy theory is that they're shills who are ensuring that LC&F is continuously mentioned on the Internet to keep boosting it up the Google rankings. Google starts to drop websites down its searches if they haven't been mentioned elsewhere on the Internet recently. Even if the response to the thread is a universal chorus of disapproval, it doesn't matter as only a minority of LC&F's target audience will read this thread and the boost the company receives to its Google ranking will make up for any customers lost.

It is impossible to know which, and there's nothing we can do about those who aren't reading these threads, so we might as well continue to post the standard responses just for the minority that do read them, and can be dissuaded from investing in an ultra-high-risk corporate loan note that is not appropriate for them.

eskbanker

Wheres_My_Cashback wrote: »

Because the finacial forums regularly suffer from trolls/students who are doing course activities for college/uni, posting fictitious scenarios to obtain opinions.

They also seem to attract posters who apparently think that repeatedly posting "Unbelievable!" is either constructive or funny when it's plainly neither....

ColdIron

fiisch wrote: »

Last time I posted on a similar thread expressing my opinion, I got a message from the moderators threatening I could be subject to legal action.

Several posters received such warnings, that's why it's best to stick to fact and not opinion. It's hard to dispute facts from the company's own disclaimer. I don't like having my posts removed and it got my dander up

dunstonh

Paul_DNAP wrote: »

PS. Why is it always new members using their first (and only) post to ask about this account?

Probably as the second or third link on google shows all the other people asking exactly the same question and getting exactly the same answers (from the same people). Maybe they dont believe the hundreds of identical messages saying not to do it and are hoping that the 1000th time will be different.

Last time I posted on a similar thread expressing my opinion, I got a message from the moderators threatening I could be subject to legal action.

At least they didn't ban you. I am only here because of the goodwill of lots of other forum members getting my ban removed.

Aegis

The fact that these are still being advertised in such a way that people think they are 8% savings accounts is a major failure of regulation and advertising standards. The FCA and ASA should be ashamed of themselves for not putting a stop to it, as clearly it's leading to a huge amount of confusion among consumers.