SVS Securities - shut down?

johnburman

No

And No

It is rediculous we do not know. Nor that there has been any consultation exercise with (at least XO) clients.

juliamarsh

t237 wrote: »

I've recently discovered that my mother was a customer of SVS Securities and was taken advantage of by their sales people, in a possibly fraudulent manner.

She put some money in a share account on the basis that she wanted to invest in low risk blue-chip type shares, and when she was cold called by SVS she explained her position, explaining that she wanted to buy low risk bonds and shares.

She was offered to buy bonds in a company called Corporate Finance Bonds Limited Series 5, and when she asked if this was a safe investment they told her she'd get guaranteed interest on it and it was very safe.

I had a look at the prospectus for this company and it says it's only to be targeted at experienced investors. She's not financially educated at all. She received her statement from the administrators a month ago and it doesn't show any interest being credited to her account even though interest was payable on a six monthly basis, and the website of the issuer is down and as far as I can tell those bond have been de-listed. She was also offered shares in an AIM listed mining company which SVS also took money from her account to buy - this company seems to still be trading.

The publication from the administrator specifically mentions Corporate Finance Bonds Limited as one of the reasons the FCA's intervention as there was corruption between SVS and the issuers of this bond. I can't tell if this bond is still trading anywhere or if it has any value at all, but my mother paid £3000 for those bonds, which SVS took directly from her account following the phone conversation where they pushed them onto her.

Does anyone have any advice on whether there is any recourse available to her? It sounds like fraud or mis-selling to me and I think this needs to be communicated to the administrators but I am not sure what the best course of action is.

Your mother was quite clearly mis-sold these investments, both the bonds and the investment in the mining company - pushing these sort of investments which fall completely outside the remit of the client's attitude to risk was classic SVS behaviour. I myself was mis-sold several investments in dodgy mining companies, I pursued a Financial Ombudsman claim against them which was successful and I received compensation. However, now that they are in administration I'm not sure whether the Financial Ombudsman will be dealing with claims against them, I suggest you ring up and ask them. If not, I'm sure she will be able to pursue a claim with the FSCS.

Malthusian

If you have a preference for a particular broker you just move your assets there once the migration has happened. You don't try to persuade the administrator to migrate everyone to them in a consultation.

The administrator needs a broker that is big enough to handle the job, has reasonable charges, isn't dodgy and will accept custody of whatever SVS clients have. Not to pick one that all SVS clients are happy with.

olderbutnowiser

You make good points Malthusian. I had been considering moving away from SVS before this debacle but was always put off by the inevitable hassle and delay that would be involved. Little did I know what was in store!

However this episode has made my mind up that I will be happy to accept whoever LC come up with on the basis that I can't face another switch.

NZPK

The problem many of us face with choosing a broker and shifting is that we are not UK resident. I went with SVS in the first place because they were willing to open an account and verify identify while being all the way over here in New Zealand. Obviously the new broker/platform must agree to taking on overseas clients in the bulk migration. Then us foreigners will just have to review the market again and see what options we have for shifting.

olderbutnowiser

I also chose to go with SVS for the same reason when I was working overseas. As I recall they were almost alone in allowing non-residents to open accounts. When I returned to the UK 18 months ago I had the opportunity to switch but apathy won the day!

My2penneth

I took a phone call today from "Bourne Consultants" (not sure about the spelling of Bourne). They wanted to speak to my wife to see how thinks were going (w.r.t. investments). We've had no previous contact with them. So, I politely told them "no thanks"and put the phone down.

johnburman

Malthusian is partially correct. But the Creditors Committee (CC) and the FCA must approve the transfer to the New Broker. Clients can not per se object but if they make their feelings known to the CC and/or FCA that should have some effect.

But the reality is that there needs to be a broker who can take everybody, overseas, SIPP, joint, clients etc. That will limit the market. BUT the fact that clients have been told nothing - let alone thei n ame - suggests all is not well in that there is no contract (even one conditional) signed. And of course nothing is forthcoming from LC.

juliamarsh

My2penneth wrote: »

I took a phone call today from "Bourne Consultants" (not sure about the spelling of Bourne). They wanted to speak to my wife to see how thinks were going (w.r.t. investments). We've had no previous contact with them. So, I politely told them "no thanks"and put the phone down.

We get calls from this lot all the time - they've asked to speak to me and my two sons on various occasions. If you check the phone number it comes up as '0'. Even though I told them the number is registered with the TPS they still keep phoning. Yesterday I thought I'd get some information to try to report them so I asked the girl for their address and she called out 'Does anybody here know our address?' When I asked for their web address and phone number she hung up. Well dodgy!

juliamarsh

t237 wrote: »

Does anyone have any advice on whether there is any recourse available to her? It sounds like fraud or mis-selling to me and I think this needs to be communicated to the administrators but I am not sure what the best course of action is.

englishmas wrote: »

My understanding is that FSCS will only deal with the losses occurs due to the SVS going to administration, not the losses due to bad advice.Also one cannot go to FCA anymore as the SVS in administration. Please correct me if I misunderstood the FCA regulations. Thanks

In answer to the above questions, I've just received the following email from FSCS:-

Latest update
We're aware that the return of money and assets may not satisfy those SVS customers who might have a claim for further losses against SVS. Customers who believe SVS has caused additional losses may wish to make a claim to FSCS in relation to those losses.

We're not currently open to these claims, as we want to make progress on reuniting customers with their money and assets. But we do intend to open to such claims, and we will announce this on our website when we are ready.

By agreeing to FSCS compensation for the costs of returning money and assets via the SVS portal, customers will be assigning their right to claim against SVS to FSCS in relation to that claim. Customers will not lose the right to make further claims to FSCS in relation to additional losses.

Although separate from any claim a client may have in relation to the costs of returning money and assets, FSCS can’t pay more than £85,000 in total per person against SVS.

We can only consider claims when we're satisfied a customer has first exhausted any right to claim against any connected firms that are still trading. We're aware that FCA authorised advisers may have recommended investments to some clients of SVS.

If an FCA authorised adviser that’s still trading advised you to invest through SVS, you need to complain to them. If your adviser rejects your complaint, you can take your complaint to the Financial Ombudsman Service (FOS).

If an FCA authorised adviser that’s now not trading advised you to invest through SVS, you’ll be able to submit a claim to FSCS against them.