SVS Securities - shut down?

My2penneth

My2penneth said:

My residual shares in one company that were sitting in my QORT account have gone AWOL ...again.! 

This time, I've emailedITI and copied it to the case officer at the FOS (quoting the FOS case number) and I also highlight that ITI have not responded to the FOS letters. 

Then the missing shares came back but now they are gone AGAIN!  

RasputinB

The Financial Ombudsman Service recently published a decision relating to ITI Capital.

An investigator considered the complaint and thought it should be upheld saying that “ITI failed to provide a reasonable service, particularly in relation to its communication with Mr M, therefore it should pay a total £250 compensation”.

ITI had offered £100 compensation.

The Ombudsman stated that “Normally, we’d expect transfers to be completed within 30 days, but on the face of the available evidence, it’s not entirely clear what happened in this instance…”

I note that the Financial Ombudsman Service had primarily identified the complaint as a failure to carry out instructions to transfer the ISA.

In my case there were many more problems including failures to properly report assets and dividends, security issues, delays in providing Contract Notes, errors in the Contract Notes, and shortfalls in dividend payments.

The Final Decision is available here - https://www.financial-ombudsman.org.uk/files/322598/DRN-3070547.pdf

Sheris

Just shows how bad L&C and the FCA are in there decision to allow ITI Capital to take over the so called special administration.
£250 offered and L&C walked away with over 20 million at £500 per hour of tax payees monies.       

eskbanker

RasputinB said:

The Financial Ombudsman Service recently published a decision relating to ITI Capital.

An investigator considered the complaint and thought it should be upheld saying that “ITI failed to provide a reasonable service, particularly in relation to its communication with Mr M, therefore it should pay a total £250 compensation”.

ITI had offered £100 compensation.

The Ombudsman stated that “Normally, we’d expect transfers to be completed within 30 days, but on the face of the available evidence, it’s not entirely clear what happened in this instance…”

I note that the Financial Ombudsman Service had primarily identified the complaint as a failure to carry out instructions to transfer the ISA.

Thanks for finding and sharing that, interesting reading.  Wonder if Mr M has been seen on this thread....

It seems to me that there is indeed extensive focus on the ISA transfer, but also familiar tales of lack of access to assets via ITI's platform(s), poor communication, delays, etc - the ombudsman's conclusion states that the £250 is "for the distress and inconvenience suffered as result of the delays for which ITI is responsible and lack of access to his account".

It's probably counterproductive for complainants to over-emphasise such transfer issues in particular, because they inherently involve two parties, and it's the receiving one that retains overall responsibility for the ISA transfer process - there is no need for the investor to advise the ceding provider at all.  In this case it seems clear that the receiving broker had at least some responsibility for the transfer delay ("I can’t entirely blame ITI for the delays that he’s experienced. In other words, on the face of the evidence, and on balance, I’m unable to safely conclude that ITI is solely responsible for the delays experienced"), so the above comment about lack of clarity over what happened seems to me to reflect the fact that when escalating a complaint about ITI to FOS, they'll only be considering ITI's role and its response to the complaint, rather than taking a broader view.

RasputinB said:

In my case there were many more problems including failures to properly report assets and dividends, security issues, delays in providing Contract Notes, errors in the Contract Notes, and shortfalls in dividend payments.

Those all sound more clear-cut than ISA transfer issues, in that ITI should be held solely responsible, but the ombudsman did seem minded to cut ITI quite a bit of slack ("Based on what ITI says, it seems its capacity to deal with Mr M arose, in the main, from issues outside of its control" when citing high volumes of activity and technical issues) so it'll be interesting to see what the outcome of your complaint(s) is - presumably the one you found will be followed by others in the near future too.

Sheris said:

L&C walked away with over 20 million at £500 per hour of tax payees monies.       

Assuming you mean 'taxpayers', which costs did they bear and via what mechanism?  I thought that (industry-funded) FSCS picked up the tab for those costs that weren't recoverable from the residual assets of SVS?

johnburman

Forget the svs insolvency and the transfer to ITI shambles. It caused almost no svs clients loss.

The actions of ITI have caused their clients loss. The shame is that the FOS only award 250 to 300 GBP damages. ITI CLIENTS SHOULD NOT ACCEPT LESS and if iti won't pay more COMPLAIN TO THE FOS. 

eskbanker

johnburman said:

The actions of ITI have caused their clients loss.

If customers have suffered actual losses then it's incumbent on them to quantify these when complaining to ITI and escalating to FOS - note that in the above case the ombudsman says "Whilst I note what Mr M says about luck and appreciation of his investments, he isn’t automatically entitled to compensation if he hasn’t suffered a financial loss, even if the business has made a mistake. In other words, he’s not entitled to compensation for losses that he hasn’t suffered, even if the business hasn’t been able to provide a reasonable service".

Note also that Mr M tried to run a 'time recharge' argument similar to what I think you've suggested previously ("Given everything that’s happened, in order to resolve the matter, he’d like the compensation increased to at least £550.  He’s spent at least two days on this case and the compensation would be equivalent to two days’ income") but this was rejected by the ombudsman ("Despite what Mr M says, this [£250] isn’t a payment based on his daily rate of income").

johnburman said:

ITI CLIENTS SHOULD NOT ACCEPT LESS and if iti won't pay more COMPLAIN TO THE FOS. 

Do you think it'll help if they complain in SHOUTY CAPITALS?

johnburman

NO but it will draw people's attention to the salient points. Hopefully. 

But what you say is wholly correct? It is very difficult to establish a 'proper' measure of damages when you can't calculate actual loss in pounds and pence. Thus you only get 250 to 300 GBP for inconvenience. My views I have expressed earlier... This low measure is an encouragement to ITI not to deal with complaints properly. Why bother? Say nothing do nothing and then cough up a few quid to the FOS for fees and 300 to an ex client.

This is why I want the county court to determine damages. But nobody, including myself, has brought an action and instead gone to the FOS. (which is free for complainants) 

eskbanker

johnburman said:

It is very difficult to establish a 'proper' measure of damages when you can't calculate actual loss in pounds and pence. Thus you only get 250 to 300 GBP for inconvenience.

Yes, it's clear from the FOS decision that (if seeking more than their standard inconvenience payment) complainants do need to quantify losses for which ITI can reasonably be held liable, and that spending lots of time chasing them isn't in itself sufficient.  Maybe others will have made a better job of it than Mr M?

johnburman said:

This is why I want the county court to determine damages. But nobody, including myself, has brought an action and instead gone to the FOS. (which is free for complainants) 

If you really believe that a court would award higher costs than FOS and want to see this happen, then why haven't you put your money where your mouth is and tested that theory?  As expressed previously, I can't imagine that a court would be more generous than FOS for intangible losses but there's only one way to find out and nobody else seems to feel as strongly as you about that prospect!  Perhaps Mr M will have rejected the FOS decision and is planning to take his chances elsewhere....

johnburman

Good Point ESKBANKER.   I started the FOS complaint very early on thinking it would take 6 months max to deal i.e. it would be quicker than the county court small claims track.  I was wrong.

But has anyone gone to the county court...and any quantum of damages discussed there?

Also, those still waiting for the FOS could accept the liability finding against ITI but ask for a review of the amount (quantum) of the award.  £250 - 300 is too low for all the amount o trauma that we have been through (including shares going 'missing' and then being found again).

We need a test case against the FOS

PS:  if there is a delay in getting  a tax certificate from ITI, that merits an additional award

johnburman

NOTE FYI:  Dated 14 January 2022.  This is on the FCA Register for ITI Capital.  Check the site here https://register.fca.org.uk/s/firm?id=001b000000MfGkrAAF#what-can-this-firm-do-restrictions

Pursuant to section 55L(5) of the Act with immediate effect. For the avoidance of doubt, this is a voluntary requirement (“VREQ”) on ITI’s permissions under Part 4A (subsection 55L(5)) of the Act).

Requirements Regulated activities

1. ITI will not accept, without the prior written consent of the Authority, any new monies or assets from existing clients. This includes monies or assets under the client assets regime, title transfer collateral arrangements, or otherwise.

For the avoidance of doubt, ITI may continue to hold client money and safeguard and administer custody assets held as at the date of these Requirements.

2. Except as provided for in paragraph 3, ITI will not onboard, without the prior written consent of the Authority, any new clients.

3. Paragraph 2 does not apply to the onboarding of former SVS Securities Plc clients transferred to ITI in accordance with the APA entered into by ITI

5. Paragraph 1 does not apply to the acceptance of monies or assets from existing clients by ITI as a result of, or in relation to, the following:

a) Existing clients trading existing money and/or assets on all platforms as detailed within ITI’s VREQ variation request letter dated 13 August 2021 and 29 September 2021;

b) Receipt of dividends or coupons;

c) Rights issues;

d) Corporate actions including maturing bonds;

e) Settlement of trades instructed but not yet settled as at the date of the Requirements; and

f) Margin calls and movements associated with open trades and positions.