SVS Securities - shut down?

bowlhead99

dales1 wrote: »

But first you will need to press Edit Options to get this choice.
Dales

Yes, if you are in the control panel and you want to change the options I suppose the first thing to do is to press the relevant button to say that you want to edit the options.

johnburman

I see LC say in their updated letter that there are several hundred SVS clients who may face losses. Any idea who are these likely to be? Any of them XO clients?

johnburman

I have just seen this press release. My underlining. How come they get paid out in 7 days whilst SVS clients have to wait?

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East London Credit Union Ltd declared in default: FSCS to protect 5,500 members
The Financial Services Compensation Scheme (FSCS) has stepped in to protect the members of East London Credit Union Ltd, trading as Waltham Forest Community Credit Union, which has stopped trading and is now in default.

FSCS will compensate within seven days the vast majority of the 5,500 members of the Walthamstow-based credit union. Using East London Credit Union Ltd’s records, FSCS will send payments out automatically.

Members with up to £1,000 in their account will receive a letter to get cash over the counter at their local Post Office. Anyone with a balance of more than £1,000 will receive a cheque for their balance direct from FSCS.

FSCS protects up to £85,000 of savings – double that for joint accounts – and has come to the aid of more than 4.5m people since 2001, paying out over £26bn in compensation.

FSCS expects the total payout for East London Credit Union Ltd to be just over £2,250,000.

Caroline Rainbird, Chief Executive of FSCS, said:

“FSCS is protecting the members of East London Credit Union Ltd and helping them to get back on track. Our aim is for the vast majority of its customers to get their money back within seven days.

“All members of the credit union need to know that their money is safe and about the safeguards that are in place. Their savings are protected up to £85,000, and joint accounts are covered for £170,000.

“FSCS covers a wide range of products and services. As well as for claims against a credit union, bank or building society, customers can be assured that should they lose money due to the failure of an authorised financial services firm, such as their investment or mortgage adviser, or debt management provider, that FSCS provides protection of up to £85,000 per person.”

For more information on how FSCS helps people with current or savings accounts in banks, building societies and credit unions, please visit FSCS’s website and see our compensation limits page.

Queries about East London Credit Union Ltd can be directed to Stephen Cork of Cork Gully LLP, who has been appointed as liquidator. The liquidator can be contacted by telephone in the first instance on 0333 210 1548.

englishmas

Reading in between the lines , I think The X_O accounts are safe , though they may have to pay LC fee,

bowlhead99

johnburman wrote: »

I have just seen this press release. My underlining. How come they get paid out in 7 days whilst SVS clients have to wait?

The customers of the credit union had deposits of known amounts, which were maintained by the CU, and so they are creditors of the business. The business is in default and can't pay the money that it owes, but the amount it owes to the customers for those deposit accounts is known, so FSCS depositary protection steps in and pays out the customers. If FSCS can later get a bit of the money back from the business, it will.

SVS was not a bank or credit union. It didn't hold customer deposits. So FSCS are not expected to step in to recover those deposits. In the SVS situation, FSCS can't just pay you off the amount of your deposit that was owed to you by a failed bank, because there isn't a failed bank that owes you a deposit back.

Instead, the execution-only customers of SVS's stockbroking business have various financial assets, which need to be sorted out and a solution found to getting the customer's assets back into their own hands. If there is an eventual loss once everything is sorted out (e.g. due to bad recordkeeping, issues with title or fraud, administrator needing to be paid out of the customer assets held if the business itself has no assets, etc), FSCS will help out, within limits.

Eastneuk

I’ve received a call from “Pension Claims Specialist” who knew I was a client of SVS and after telling the person to take a hike, I was wondering how they got hold of my mobile number. Has LC been selling our data or someone from within what remains of SVS?

pafpcg

johnburman wrote: »

I see LC say in their updated letter that there are several hundred SVS clients who may face losses. Any idea who are these likely to be? Any of them XO clients?

If you're referring to the paragraph on page three of the letter, then the answer is given in the rest of the paragraph! [Either because the SVS client is ineligible for FSCS protection or their assets with SVS are greater than £85,000.]

My understanding is that clients of SVS XO are being treated the same as all the other SVS clients so they will all suffer a loss (assuming that the overall SVS liabilities exceed the overall assets); this loss will be mitigated by compensation from FSCS (if the client is eligible) up to £85,000 per client. Unless LC have already calculated the overall shortfall in SVS assets against liabilities, then they will have assumed the worst case, 100% loss, and set the portfolio threshold at £85,000. Until the overall shortfall is known, the number of clients who will actually suffer a real loss is just speculation.

englishmas

FSCS will only deals withe the compensation claims by SVS clients after LC finish their work, I tried to contact FSCS regarding my claim and so for they have not even acknowledged my letter, even my claim is nothing to do with LC.

johnburman

Couple of points

1 XO clients have assets that belong to them not to SVS. They are not true 'clients' in the sense they do not deposit money to be used by a bank, but they pay for transactions...they are beneficailly entitled to *their* (client) assets and (client) money.

2 Because of 1 payments shodul be quicker not slower (!)

2A you say FSCS will only deals withe the compensation claims by SVS clients after LC finish their work but why? And will they pay interest for the delay? Have you asked?

3 See below extract from FT Advisor (with my underlining). SIPP SVS clients try the FOS!

Tenet to pay out for Sipp advice
Tenet to pay out for Sipp advice
By Rachel Mortimer

The Financial Ombudsman Service has ordered TenetConnect to compensate a client who was unsuitably advised to switch his pension by one of its appointed representatives.

The client was first introduced to the appointed representative by a loans company which subsequently lent him money to invest in unlisted securities.

The appointed representative advised the client to switch his personal pension to a self-invested personal pension with SVS Securities, which recently entered administration after the Financial Conduct Authority conducted "urgent" supervisory work at the firm, and a total of £20,321 was invested in SVS, Guardia and Titanium International.

In a decision published in July the ombudsman found one of these companies, SVS, had now failed and the other two had "significantly fallen in value".

When the client complained to Tenet about the adviser, who he believed had mis-sold the Sipp and bought too many shares in the companies without proper due diligence, the network said it had no knowledge of the advice provided by its appointed representative.

Tenet maintained no paperwork associated with regulated financial advice existed and it had not received any commission - it also argued neither the SVS Sipp nor the unlisted securities products approved by Tenet and its appointed representatives were only authorised to advise on approved products.

But the ombudsman ruled in favour of the client despite Tenet's objections, finding the company was liable for the unsuitable advice provided by its appointed representative regardless of whether part of it technically fell outside of the network's responsibilities.

Despite acknowledging the advice process was "not well documented" ombudsman Michael Stubbs said it was "more likely than not" that the appointed representative had advised on the pension switch because the adviser was paid a fee of £1,000 for his part in helping the client take out the Sipp and was listed as the client's adviser on the supporting application.

Mr Stubbs agreed neither the SVS Sipp nor the unlisted securities were products Tenet had authorised its appointed representatives to advise on and therefore advising on these products fell outside of the authority granted to the adviser.

But the ombudsman ruled the original advice for the client to surrender his existing personal pension policy did fall within the authority granted by Tenet, and that the two pieces of advice were so closely linked as to bring the entirety under the responsibility of the network.

The ombudsman's decision followed a ruling by the High Court in a case involving Tenet that if a piece of regulated advice and unregulated advice were "inextricably linked" they could be constituted as a single piece of regulated advice.

Mr Stubbs said: "As I said earlier the client was advised to switch his personal pension to a Sipp and to then invest in unquoted shares. The whole purpose of the advice was to enable the client to purchase the shares.

"Without the purchase of the shares the loan that the client was looking to obtain would not have been forthcoming. I therefore consider that the various elements of this advice are inextricably linked – without the pension switch there would have been no share purchase.

bowlhead99

englishmas wrote: »

FSCS will only deals withe the compensation claims by SVS clients after LC finish their work, I tried to contact FSCS regarding my claim and so for they have not even acknowledged my letter, even my claim is nothing to do with LC.

I'm not sure what your 'claim' is for, and why it is nothing to do with LC. The company still exists, and is in administration. LC are administering SVS Securities plc and sorting through the assets and will provide more information on how you should go about making claims in due course.

There's no real point going to FSCS and saying you need to be compensated because the company didn't pay you out, when you have not given the SVS administrators the chance to pay you out as they conclude their work.

If your claim is not to do with SVS holding your assets but instead relates to SVS giving you bad advice, again you should be complaining to SVS first, which is how it works for all regulated firms that are not yet defunct.