SVS Securities - shut down?

RasputinB

kencom said:

LIONSGOLD LTD (now TALLY LTD)
FRONTERA RESOURCES LTD

Good luck all…

SVS held 32 holdings of “LIONSGOLD LIMITED - DELISTED 12/11/2018” GG00B3M9KL68 and a total of 4,883,599 shares.

The company broker appears to have been Cornhill Capital.  It may be of interest that this broker was fined £210,000 by the LSE - Cornhill Capital Fined Over AIM Placing - ShareSoc

SVS held 59 holdings of “FRONTERA RESOURCES CORP -LISTING CANCELLED 25/1/19” KYG368131069 and a total of 102,968,794 shares.

The company broker appears to have been W H Ireland. It may be of interest that this broker was fined £1.2 million by the FCA - W H Ireland Limited (fca.org.uk)

The brokers may be able to help regarding contacting the respective registrars?

https://www.pellocapital.com/ and https://www.whirelandplc.com/our-offices/capital-markets-in-london

RasputinB

masonic said:

RasputinB said:

Regarding the second point I wonder if clients who haven't got their assets back will simply be dumped. My understanding is that SVS clients legally "got their assets back" when LC transferred them to ITI Capital. If the clients haven't managed to get around to extracting their holdings from ITI surely it is expecting too much to expect ITI (or their independent third party) to now get transfers of suspended shares executed or certificates etc. on the way before the plug is pulled?

We should take care not to confuse parties here. SVS legally returned all assets to clients on the Settlement Date of the transfer, so thereafter SVS has no liability to clients. ITI on the other hand took on that responsibility at the same time, and, while they remain solvent, are the legal custodians of any remaining assets owned by clients. Clients have a legal claim to those assets until such time as ITI enters administration, at which point clients would have to go through another iteration of the process. If they can get in earlier than that, and extract share certificates with the help of the FOS, so much the better. I don't think anyone has to (or should) relinquish their claim to their assets currently held by ITI.

I agree that no one has to relinquish their claim to their assets currently held by ITI. I was thinking more of the practicalities. Will people be prepared to go through the hassle of insisting that ITI be responsible for returning those assets and do this in time? If ITI goes into administration what hope of claiming compensation through the Financial Services Compensation Scheme when the shares are unlisted and any value difficult, if not impossible, to obtain?
If the unlisted holdings are transferred to a new broker in due course would clients be prepared to pay any holding charges?

masonic

RasputinB said:

masonic said:

RasputinB said:

Regarding the second point I wonder if clients who haven't got their assets back will simply be dumped. My understanding is that SVS clients legally "got their assets back" when LC transferred them to ITI Capital. If the clients haven't managed to get around to extracting their holdings from ITI surely it is expecting too much to expect ITI (or their independent third party) to now get transfers of suspended shares executed or certificates etc. on the way before the plug is pulled?

We should take care not to confuse parties here. SVS legally returned all assets to clients on the Settlement Date of the transfer, so thereafter SVS has no liability to clients. ITI on the other hand took on that responsibility at the same time, and, while they remain solvent, are the legal custodians of any remaining assets owned by clients. Clients have a legal claim to those assets until such time as ITI enters administration, at which point clients would have to go through another iteration of the process. If they can get in earlier than that, and extract share certificates with the help of the FOS, so much the better. I don't think anyone has to (or should) relinquish their claim to their assets currently held by ITI.

I agree that no one has to relinquish their claim to their assets currently held by ITI. I was thinking more of the practicalities. Will people be prepared to go through the hassle of insisting that ITI be responsible for returning those assets and do this in time? If ITI goes into administration what hope of claiming compensation through the Financial Services Compensation Scheme when the shares are unlisted and any value difficult, if not impossible, to obtain?
If the unlisted holdings are transferred to a new broker in due course would clients be prepared to pay any holding charges?

Each client would need to take a view based on their circumstances, but if all ITI is left holding is a small number of delisted shares for a handful of retail clients, then it would be surprising if these were bulk transferred to a new broker rather than rematerialised. It doesn't appear anyone was subjected to their suspended holdings being valued for FSCS compensation rather than returned to them (even if returned in this instance meant passing the buck to another nominee).

If the shares are eventually deemed worthless, either through the companies liquidating or them being valued at 0p for FSCS compensation, then that would create a loss that can be used for CGT relief in the future, whereas until that point they are in limbo. The danger would be in them being declared worthless prematurely and them going on to be relisted, at which point there may be no way to claim them back. That's why I would favour taking a complaint the FOS in order to apply more pressure if ITI is unwilling or unable to fill out a different kind of stock transfer form to have the shares re-registered to the beneficial owner.

RasputinB

masonic said:

RasputinB said:

masonic said:

RasputinB said:

Regarding the second point I wonder if clients who haven't got their assets back will simply be dumped. My understanding is that SVS clients legally "got their assets back" when LC transferred them to ITI Capital. If the clients haven't managed to get around to extracting their holdings from ITI surely it is expecting too much to expect ITI (or their independent third party) to now get transfers of suspended shares executed or certificates etc. on the way before the plug is pulled?

We should take care not to confuse parties here. SVS legally returned all assets to clients on the Settlement Date of the transfer, so thereafter SVS has no liability to clients. ITI on the other hand took on that responsibility at the same time, and, while they remain solvent, are the legal custodians of any remaining assets owned by clients. Clients have a legal claim to those assets until such time as ITI enters administration, at which point clients would have to go through another iteration of the process. If they can get in earlier than that, and extract share certificates with the help of the FOS, so much the better. I don't think anyone has to (or should) relinquish their claim to their assets currently held by ITI.

I agree that no one has to relinquish their claim to their assets currently held by ITI. I was thinking more of the practicalities. Will people be prepared to go through the hassle of insisting that ITI be responsible for returning those assets and do this in time? If ITI goes into administration what hope of claiming compensation through the Financial Services Compensation Scheme when the shares are unlisted and any value difficult, if not impossible, to obtain?
If the unlisted holdings are transferred to a new broker in due course would clients be prepared to pay any holding charges?

Each client would need to take a view based on their circumstances, but if all ITI is left holding is a small number of delisted shares for a handful of retail clients, then it would be surprising if these were bulk transferred to a new broker rather than rematerialised. It doesn't appear anyone was subjected to their suspended holdings being valued for FSCS compensation rather than returned to them (even if returned in this instance meant passing the buck to another nominee).

If the shares are eventually deemed worthless, either through the companies liquidating or them being valued at 0p for FSCS compensation, then that would create a loss that can be used for CGT relief in the future, whereas until that point they are in limbo. The danger would be in them being declared worthless prematurely and them going on to be relisted, at which point there may be no way to claim them back. That's why I would favour taking a complaint the FOS in order to apply more pressure if ITI is unwilling or unable to fill out a different kind of stock transfer form to have the shares re-registered to the beneficial owner.

I agree that it should be possible to rematerialise shares but kencom did say that "I cannot get share certificates for either share & neither of these share companies are contactable". I doubt that ITI or their third party / administrators will try any harder but I am happy to be proved wrong.
I also agree about taking a complaint to the FOS in order to apply more pressure on ITI.
The data from LC's transfer list shows that there were about 2,700 holdings marked as delisted / unlisted / in administration / cancelled / suspended etc. I wonder how many of those have actually been dealt with and suspect that many are still on ITI's dubious QORT system. My guess is that most holders have written them off. or will, do so.
Regarding valuation for CGT losses I know that HMRC have a list of shares deemed to be of Nil Value. The timing and value of crystallised loss for the type of share we are talking about would probably come down to negotiation so, yes, a value of 0p for FSCS compensation would help. What I normally do is to take a view, fully document it on my Tax Return, and if HMRC don't come back to me then I assume their agreement. If the amount of tax is significant then I'd try to get a preliminary view from them.

johnburman

This all makes interesting reading, but cannot the advice be:

1)   hold ITI responsible for 'holding' the shares; at least until they are formally declared nil value; and
2)   claim on the FOS anyway for:

       a)   ITI's refusal to deal* etc.; and
       b)   the inconvenience caused by a) etc. anyway?

*This must be contrary to treating clients fairly (as well as breach of contract?) by ITI.

RasputinB

johnburman said:

This all makes interesting reading, but cannot the advice be:

1)   hold ITI responsible for 'holding' the shares; at least until they are formally declared nil value; and
2)   claim on the FOS anyway for:

       a)   ITI's refusal to deal* etc.; and
       b)   the inconvenience caused by a) etc. anyway?

*This must be contrary to treating clients fairly (as well as breach of contract?) by ITI.

I don't see that it is a problem if clients are happy for ITI to hold the shares (unless they go into administration / cease) but if they want to transfer / get the certificates and ITI don't respond then that is a problem which, IMO, should be taken to the FOS straight away (or after the 8 weeks or whatever).
If the shares are unlisted / suspended then it is hardly ITI's fault if they can't be traded and similarly if they are, or become, valueless. 
There would be an argument for treating clients unfairly if those with complaints with the FOS got their transfers / share certificates and those not complaining didn't. But compensation for nil value shares?
But a point that I have been trying to make (no doubt badly) is that there are a lot of these shares and very few official complaints. To me that doesn't add up - unless most clients are prepared to write them of, or ITI have in fact got up to date with transfers.

jenwrendorset

RasputinB said:

johnburman said:

This all makes interesting reading, but cannot the advice be:

1)   hold ITI responsible for 'holding' the shares; at least until they are formally declared nil value; and
2)   claim on the FOS anyway for:

       a)   ITI's refusal to deal* etc.; and
       b)   the inconvenience caused by a) etc. anyway?

*This must be contrary to treating clients fairly (as well as breach of contract?) by ITI.

I don't see that it is a problem if clients are happy for ITI to hold the shares (unless they go into administration / cease) but if they want to transfer / get the certificates and ITI don't respond then that is a problem which, IMO, should be taken to the FOS straight away (or after the 8 weeks or whatever).
If the shares are unlisted / suspended then it is hardly ITI's fault if they can't be traded and similarly if they are, or become, valueless. 
There would be an argument for treating clients unfairly if those with complaints with the FOS got their transfers / share certificates and those not complaining didn't. But compensation for nil value shares?
But a point that I have been trying to make (no doubt badly) is that there are a lot of these shares and very few official complaints. To me that doesn't add up - unless most clients are prepared to write them of, or ITI have in fact got up to date with transfers.

I'm not happy with ITI holding anything of ours because my gut feeling is that they may cease trading anytime soon so I've sent off an official complaint to compliance@iticapital.com as 'suggested' by LC, this follows the 2 emails which they have failed to reply to bar the automatic response; I've completed 2 complaint forms to FOS (covering the 2 accounts), I've also completed 2 complaint forms to the FCA and finished it all off with yet another email to LC as they didn't bother to answer the one question I asked......don't think there is anything further to do but sit back and let them get on with it....both FOS and FCA have acknowledged receipt and the latter has included case numbers so watch this space.  I'm not looking for compensation or anything like that, all I want are the 2 share certificates that prove our ownership of these holdings and that task can only be attributed to ITI Capital.

masonic

RasputinB said:

masonic said:

RasputinB said:

masonic said:

RasputinB said:

Regarding the second point I wonder if clients who haven't got their assets back will simply be dumped. My understanding is that SVS clients legally "got their assets back" when LC transferred them to ITI Capital. If the clients haven't managed to get around to extracting their holdings from ITI surely it is expecting too much to expect ITI (or their independent third party) to now get transfers of suspended shares executed or certificates etc. on the way before the plug is pulled?

We should take care not to confuse parties here. SVS legally returned all assets to clients on the Settlement Date of the transfer, so thereafter SVS has no liability to clients. ITI on the other hand took on that responsibility at the same time, and, while they remain solvent, are the legal custodians of any remaining assets owned by clients. Clients have a legal claim to those assets until such time as ITI enters administration, at which point clients would have to go through another iteration of the process. If they can get in earlier than that, and extract share certificates with the help of the FOS, so much the better. I don't think anyone has to (or should) relinquish their claim to their assets currently held by ITI.

I agree that no one has to relinquish their claim to their assets currently held by ITI. I was thinking more of the practicalities. Will people be prepared to go through the hassle of insisting that ITI be responsible for returning those assets and do this in time? If ITI goes into administration what hope of claiming compensation through the Financial Services Compensation Scheme when the shares are unlisted and any value difficult, if not impossible, to obtain?
If the unlisted holdings are transferred to a new broker in due course would clients be prepared to pay any holding charges?

Each client would need to take a view based on their circumstances, but if all ITI is left holding is a small number of delisted shares for a handful of retail clients, then it would be surprising if these were bulk transferred to a new broker rather than rematerialised. It doesn't appear anyone was subjected to their suspended holdings being valued for FSCS compensation rather than returned to them (even if returned in this instance meant passing the buck to another nominee).

If the shares are eventually deemed worthless, either through the companies liquidating or them being valued at 0p for FSCS compensation, then that would create a loss that can be used for CGT relief in the future, whereas until that point they are in limbo. The danger would be in them being declared worthless prematurely and them going on to be relisted, at which point there may be no way to claim them back. That's why I would favour taking a complaint the FOS in order to apply more pressure if ITI is unwilling or unable to fill out a different kind of stock transfer form to have the shares re-registered to the beneficial owner.

I agree that it should be possible to rematerialise shares but kencom did say that "I cannot get share certificates for either share & neither of these share companies are contactable". I doubt that ITI or their third party / administrators will try any harder but I am happy to be proved wrong.

Every listed company has a company serving as its registrar. The registrar deals with record keeping related to ownership of the shares. I've not seen anything posted by kencom that suggests the registrar in this case (rather than the suspended company) was contacted. Of course, only an authorised representative of ITI's nominee company could enter into discussion about shares currently registered to the nominee, but the appropriate registrar could probably confirm to anyone whether it is able to re-register (and rematerialise) shares in the company in question.

RasputinB said:

I also agree about taking a complaint to the FOS in order to apply more pressure on ITI.
The data from LC's transfer list shows that there were about 2,700 holdings marked as delisted / unlisted / in administration / cancelled / suspended etc. I wonder how many of those have actually been dealt with and suspect that many are still on ITI's dubious QORT system. My guess is that most holders have written them off. or will, do so.
Regarding valuation for CGT losses I know that HMRC have a list of shares deemed to be of Nil Value. The timing and value of crystallised loss for the type of share we are talking about would probably come down to negotiation so, yes, a value of 0p for FSCS compensation would help. What I normally do is to take a view, fully document it on my Tax Return, and if HMRC don't come back to me then I assume their agreement. If the amount of tax is significant then I'd try to get a preliminary view from them.

That sounds like a useful approach to take. The concern I'd have is if the shares do go on to have value, and there is no official declaration that they are irrecoverable and written down to 0p (or even if formerly treated as being worthless by FSCS), it becomes tricky, as you end up being deprived of an asset that has value, but may no longer have a claim to the assets under FSCS rules. I suppose there isn't much point thinking about this until all efforts to extract the assets from ITI, or satisfactory compensation for giving them up from FOS, have failed.

Unmentionable

I've been lurking on this thread since the initial SVS debacle and decided to finally sign up and add my experiences.

Having tried to transfer away from ITI into IWEB in late 2020 with no progress (IWEB tell me they tried to contact ITI 8 times without response and then closed the transfer in June '21) I've decided to have another go (considering the circumstances).

After a couple of weeks, IWEB send me a letter saying "On this occassion we cannot proceed with your transfer due to some security risks identified, which prevent us from corresponding and sharing customer information with this particular company"

I've phoned IWEB several times in the last few days and got a range of different answers about what this means, including:
"FCA rules prevent us from proceeding with the transfer"
"ITI don't have a business in the UK and so they can't use the CREST system"
"[IWEB] cannot speak to [ITI] / are not able to get in contact"
They also say this will be the situation for the foreseeable future.
It's quite clear that those answering the phones and their direct supervisors (who they've conferred with) have not been given the full reason by upper management, and there doesn't seem to be a forthcoming way to escalate.
My guess (and it's only a guess) is that they are sick of ITI being so slow and cumbersome and have issued a blanket rule to decline transfers.
I've essentially given up on trying the IWEB route.

I also spoke to the FCA and they say there are no restrictions on ITI which would prevent a transfer out.

Finally, I've now set up an account with H&L who I spoke to on the phone. They assured me that they are having no issues transferring from ITI (besides the usual paper form based system ITI insist on), so that request away in the post.

Has anyone else had the same recent issue with IWEB or found a broker that can successfully extract their investments from ITI recently?

johnburman

It would be very wrong for iWeb to refuse to accept a transfer 

I would venture that would put them in breach with the FCA and tax rules on ISA s

But why were you so silly as to keep anything with ITI. Also Jarvis are smaller but seem to be OK to deal with. HL are a bit expensive