Secured Bond Investments - Scams

DermotR

On a secured fixed term bond,  when things go wrong even with initial due diligence with the likes of Companies House, The FCA, Action Fraud and the Sussex Police and crime commissioner, where does one turn. Secured bonds normally should have  an asset of some type set against them to the value of the loan note  and the whole idea is that your capital is safe and suppose to be managed by a securities trustee; but some scams are very intricate  and if the police etc are sorry  but not interested. So where does one go next please? From my limited knowledge it appears the accreditations of the above don't mean much. Any sensible suggestions gratefully received.
Thank you 

eskbanker

What's the name of the company concerned?  Links would help....

How exactly did your initial due diligence include Action Fraud and the police?

Thrugelmir

How did source the investment initially?  

jimjames

DermotR said:

On a secured fixed term bond,  when things go wrong even with initial due diligence with the likes of Companies House, The FCA, Action Fraud and the Sussex Police and crime commissioner, where does one turn. Secured bonds normally should have  an asset of some type set against them to the value of the loan note  and the whole idea is that your capital is safe and suppose to be managed by a securities trustee; but some scams are very intricate  and if the police etc are sorry  but not interested. So where does one go next please? From my limited knowledge it appears the accreditations of the above don't mean much. Any sensible suggestions gratefully received.
Thank you 

As above what did due diligence consist of? I've seen a few people say they did due diligence on London Capital & Finance yet even a cursory glance at Google would have shown red flags plus detailed warnings here. You would also have undoubtedly seen the limitations of the security trustee structure as well as guarantees only being as good as the other party. 

If it's unregulated then you have very little to go on as "secured on assets" means nothing as assets can (and almost certainly are) worth less than liabilities if you've been told there is no repayment. Presumably your due diligence showed what assets your money was secured on, what has happened to them?

Malthusian

If you were advised by an FCA-regulated adviser or invested via an FCA-regulated pension provider you have recourse to the FOS and FSCS, starting with a formal complaint to the FCA-regulated entity that the investment was not suitable for you.

Otherwise you have probably lost your money and the best course of action is to write it off and treat any recovery as a bonus.

A tiny handful of these schemes are eligible for compensation (LCF, Basset & Gold) but if that was the case with yours you would be proactively contacted.

jimjames

Malthusian said:

Otherwise you have probably lost your money and the best course of action is to write it off and treat any recovery as a bonus.

This advice is worth bearing in mind if you are contacted by someone claiming they can recover your money for a fee. If so it will be a scam, there isn't a route to get money back unless you take legal action against the owners and even then it would be likely to fail if there are no assets left. There are many scammers targeting those who have lost money in unregulated bonds so be very wary.

@DermotR any feedback on which it was and the other info mentioned above?

lozzy1965

Would be good if @DermotR responded to the questions asked about the said secured fixed term bond.  I assume being active at 7:30 this morning meant they saw all answers posted before then?  Might have been rushing off to work though, so maybe we will find out more later today?  The more specific the information provided the better the advice back will be.

DermotR

Sorry for the delay in getting any responses so will try to respond to all questions.
Bond was with NQ minerals PLC marketed by Ipsum investments.
Due diligence. at the time talking to Introducer, FCA, companies house, and to a director of the company  NQ on one of his visits to the UK. Checked via internet mine production and company status also reviewed a few forums

long story but went into voluntary insolvency appointed  Begbies Traynor

Then things went wrong secured Bond suddenly becomes a loan note discrepancies and anomalies started appearing with directors etc involvement. Sought FCA help and later Uk gov insolvency agency; lots of being fobbed off or  4 week delays begin as no agent is available… Now part of a facebook group of 54 similar investors all getting sidelined  although credit value of all the note holders exceeds £10 million GBP 

Regulators appear to have no powers 


Same thing with Fabcourt Developments reported now to  2 police forces but response not enough info to take this forward, despite providing details including photos of directors please search Fabcourt development scam and see an article from the daily mirror by Andrew Penman 

kind regards to all

masonic

DermotR said:

Sorry for the delay in getting any responses so will try to respond to all questions.
Bond was with NQ minerals PLC marketed by Ipsum investments.
Due diligence. at the time talking to Introducer, FCA, companies house, and to a director of the company  NQ on one of his visits to the UK. Checked via internet mine production and company status also reviewed a few forums

There doesn't appear to be any evidence that the so called "bond" was secured against any assets. Ipsum Invest has never held the regulatory permissions required to approve financial promotions to consumers, but previously was authorised as a representative of two authorised firms. You will already be aware of this through your due diligence I am sure. Any case you'd have around the inaccuracies in the financial promotion would be against the authorised firm that approved it.

Although I've only skimmed through the administrators proposals and progress report, there doesn't appear to be any suggestion of misconduct by the directors of the company in which the investment was made. It looks like the business had been struggling for some time, accumulating debt, and subsequently failed. The administrators have investigated the alleged misselling, the attempts to secure further investment while the business was failing, and alleged accounting issues. That's their statutory duty, and they'll provide a report to the relevant authorities. If there was any wrongdoing, then the directors would face prosecution. There is no need for individual investors to attempt to build a case, beyond providing information to the administrators where they've indicated this would be useful.

Did the due diligence you performed at Companies House identify the group accounts for 2016 through to 2019 showing that the business was making large and ever increasing losses from its activities?

DermotR said:

long story but went into voluntary insolvency appointed  Begbies Traynor

Then things went wrong secured Bond suddenly becomes a loan note discrepancies and anomalies started appearing with directors etc involvement. Sought FCA help and later Uk gov insolvency agency; lots of being fobbed off or  4 week delays begin as no agent is available… Now part of a facebook group of 54 similar investors all getting sidelined  although credit value of all the note holders exceeds £10 million GBP 

Regulators appear to have no powers

It was an unregulated investment, known as a mini-bond, so you are correct that the regulators have very limited powers. The bond was never secured, as can be verified through Companies House. The issue therefore appears that a legal charge was not registered, or the bond was mis-sold as secured when it was not. The authorised firm that was responsible for marketing to consumers would have some responsibility for that, although it is not clear which firm this is. You may be able to complain to this firm, and escalate to the Financial Ombudsman Service if appropriate, so it would be a good idea to check your paperwork to identify the firm.

DermotR said:

Same thing with Fabcourt Developments reported now to  2 police forces but response not enough info to take this forward, despite providing details including photos of directors please search Fabcourt development scam and see an article from the daily mirror by Andrew Penman

Regarding Fabcourt Developments, this is a clear example of an unauthorised firm selling investments without permission: https://www.fca.org.uk/news/warnings/fabcourt-developments

Needless to say, never deal with a firm that isn't on the FCA register or doesn't have the required permissions for its activities.

dunstonh

Due diligence. at the time talking to Introducer, FCA, companies house, and to a director of the company  NQ on one of his visits to the UK. Checked via internet mine production and company status also reviewed a few forums

Companies house doesn't really tell you anything.  Pretty much anyone can open a company.
Introducers are marketers of the product.  So, not sufficient to be due dilligence.
FCA won't provide advice but the FCA register will help identify if you are talking to a regulated company and whether they have advice permissions.     However, an FCA authorised company retailing an unregulated product with no advice permissions doesn't provide you any consumer protection.

Then things went wrong secured Bond suddenly becomes a loan note 

Despite what these companies may market them as, they are loan notes. i.e. high risk unregulated investments with no consumer protection.

Regulators appear to have no powers 

The regulator has plenty of power.  Indeed, it is considered one of the most powerful regulators in the world.   However, its power is over regulated firms providing regulated services and products.   It does not have remit over unregulated firms providing unregulated services/products.