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Hargreaves Lansdown Not supporting BDC's.

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I've shares in a few BDC's with HL that were fine until this morning, when they were put through for reinvestment. They have appeared as cash balances rather than buying new shares. Upon doing a quick search, it appears they no longer support them because the Key Investor Info has not been supplied. They state this is a legal requirement and without this, they cant allow trading in the stock. The stocks are Blackrock TCPC and Blue Owl OBDC, both of these have been bought in this tax year despite the regulations being in force for at least 2 years according to HL. Has anyone had a similar issue, and although I did my research into these companies and I was happy, have HL done me here and effectively mis-sold me the shares as I shouldn't have been able to buy them in the first place.. As I say I'm happy to keep them but means I cant compound them by reinvesting and effectively will have to withdraw the cash each Quarter or sell the positions incurring potential CGT and transaction costs.

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  • wmb194
    wmb194 Posts: 3,537 Forumite
    First Post First Anniversary Name Dropper Photogenic
    edited 11 July at 9:48AM
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    I've shares in a few BDC's with HL that were fine until this morning, when they were put through for reinvestment. They have appeared as cash balances rather than buying new shares. Upon doing a quick search, it appears they no longer support them because the Key Investor Info has not been supplied. They state this is a legal requirement and without this, they cant allow trading in the stock. The stocks are Blackrock TCPC and Blue Owl OBDC, both of these have been bought in this tax year despite the regulations being in force for at least 2 years according to HL. Has anyone had a similar issue, and although I did my research into these companies and I was happy, have HL done me here and effectively mis-sold me the shares as I shouldn't have been able to buy them in the first place.. As I say I'm happy to keep them but means I cant compound them by reinvesting and effectively will have to withdraw the cash each Quarter or sell the positions incurring potential CGT and transaction costs.

    "A business development company (BDC) can be viewed as a wrapper or vehicle for investors to access ownership in a diversified pool of private credit assets. A BDC is a closed-end investment company, created by Congress through an amendment to the Investment Company Act of 1940 under Section 54 called the Small Business Investment Incentive Act of 1980. As the name suggests, the intention of the legislation was to promote capital investment by closed-end funds to an important part of the U.S. economy—small and middle-market businesses, which were struggling for access to debt and equity capital following the recession in the 1970s."

    Yeah, as collective investments if they don't supply the required MIFID/PRIIPS compliant disclosures/KiDs you won't be able to invest in them. It could be they either previously slipped through the net or then valid documents have expired.

    If you're not being forced to sell them then I don't see how you can complain, these things happen, and you presumably bought them on an execution only basis i.e. no advice.
  • Joliet_Jake
    Joliet_Jake Posts: 5 Forumite
    First Anniversary First Post
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    wmb194 said:
    I've shares in a few BDC's with HL that were fine until this morning, when they were put through for reinvestment. They have appeared as cash balances rather than buying new shares. Upon doing a quick search, it appears they no longer support them because the Key Investor Info has not been supplied. They state this is a legal requirement and without this, they cant allow trading in the stock. The stocks are Blackrock TCPC and Blue Owl OBDC, both of these have been bought in this tax year despite the regulations being in force for at least 2 years according to HL. Has anyone had a similar issue, and although I did my research into these companies and I was happy, have HL done me here and effectively mis-sold me the shares as I shouldn't have been able to buy them in the first place.. As I say I'm happy to keep them but means I cant compound them by reinvesting and effectively will have to withdraw the cash each Quarter or sell the positions incurring potential CGT and transaction costs.

    "A business development company (BDC) can be viewed as a wrapper or vehicle for investors to access ownership in a diversified pool of private credit assets. A BDC is a closed-end investment company, created by Congress through an amendment to the Investment Company Act of 1940 under Section 54 called the Small Business Investment Incentive Act of 1980. As the name suggests, the intention of the legislation was to promote capital investment by closed-end funds to an important part of the U.S. economy—small and middle-market businesses, which were struggling for access to debt and equity capital following the recession in the 1970s."

    Yeah, as collective investments if they don't supply the required MIFID/PRIIPS compliant disclosures/KiDs you won't be able to invest in them. It could be they either previously slipped through the net or then valid documents have expired.

    If you're not being forced to sell them then I don't see how you can complain, these things happen, and you presumably bought them on an execution only basis i.e. no advice.
    Thanks for replying, appreciate it.

    My understanding was US companies were not bound by EU PRIIPs rules that ask for the Key investor information, as I believe we are still following?

    Another ,query also is It looks like I can manually reinvest the dividends myself ( need to wat till 2.30 to check) whilst incurring fees, whereas dividend reinvestment is nominally a £1. This doesn't seem correct either, surely its black and white, trading allowed, trading not allowed.



  • wmb194
    wmb194 Posts: 3,537 Forumite
    First Post First Anniversary Name Dropper Photogenic
    edited 11 July at 11:54AM
    Options
    wmb194 said:
    I've shares in a few BDC's with HL that were fine until this morning, when they were put through for reinvestment. They have appeared as cash balances rather than buying new shares. Upon doing a quick search, it appears they no longer support them because the Key Investor Info has not been supplied. They state this is a legal requirement and without this, they cant allow trading in the stock. The stocks are Blackrock TCPC and Blue Owl OBDC, both of these have been bought in this tax year despite the regulations being in force for at least 2 years according to HL. Has anyone had a similar issue, and although I did my research into these companies and I was happy, have HL done me here and effectively mis-sold me the shares as I shouldn't have been able to buy them in the first place.. As I say I'm happy to keep them but means I cant compound them by reinvesting and effectively will have to withdraw the cash each Quarter or sell the positions incurring potential CGT and transaction costs.

    "A business development company (BDC) can be viewed as a wrapper or vehicle for investors to access ownership in a diversified pool of private credit assets. A BDC is a closed-end investment company, created by Congress through an amendment to the Investment Company Act of 1940 under Section 54 called the Small Business Investment Incentive Act of 1980. As the name suggests, the intention of the legislation was to promote capital investment by closed-end funds to an important part of the U.S. economy—small and middle-market businesses, which were struggling for access to debt and equity capital following the recession in the 1970s."

    Yeah, as collective investments if they don't supply the required MIFID/PRIIPS compliant disclosures/KiDs you won't be able to invest in them. It could be they either previously slipped through the net or then valid documents have expired.

    If you're not being forced to sell them then I don't see how you can complain, these things happen, and you presumably bought them on an execution only basis i.e. no advice.
    Thanks for replying, appreciate it.

    My understanding was US companies were not bound by EU PRIIPs rules that ask for the Key investor information, as I believe we are still following?

    Another ,query also is It looks like I can manually reinvest the dividends myself ( need to wat till 2.30 to check) whilst incurring fees, whereas dividend reinvestment is nominally a £1. This doesn't seem correct either, surely it's black and white, trading allowed, trading not allowed.

    These aren't ordinary US companies but investment trust-type companies ("CEFs") and investment trusts have to comply so these should as well. Edit: If they want to sell them in Europe, that is.

    I've experienced this situation with another broker. I wasn't forced to sell though I could but if I tried to buy the website would throw up an error message saying something along the lines of UK investors not being allowed to purchase. You might be lucky though; give it a go and see what happens.
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