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  • FIRST POST
    • carlnicholls
    • By carlnicholls 10th Jan 18, 2:51 PM
    • 5Posts
    • 0Thanks
    carlnicholls
    I can find 8% investments - Am I missing something??
    • #1
    • 10th Jan 18, 2:51 PM
    I can find 8% investments - Am I missing something?? 10th Jan 18 at 2:51 PM
    Hi Guys.
    Perhaps being thick, naive or both. Was looking for the best paying fixed ISA was seeing figures of 1.85% but then found a couple of companies offering 8% for the same period.
    Are these companies such as London Capital Investment rouges or are they not listed for another reason??

    Thanks in anticipation

    Carl
Page 2
    • dunstonh
    • By dunstonh 11th Jan 18, 9:43 PM
    • 93,036 Posts
    • 60,430 Thanks
    dunstonh
    James, have you thought about sending that to the FCA. They are looking at unregulated investments and how they are marketed at the moment. You may find someone willing to take an interest.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • jimjames
    • By jimjames 11th Jan 18, 11:07 PM
    • 12,653 Posts
    • 11,322 Thanks
    jimjames
    James, have you thought about sending that to the FCA. They are looking at unregulated investments and how they are marketed at the moment. You may find someone willing to take an interest.
    Originally posted by dunstonh
    I'll give it another go. Last time they weren't interested and nor were ASA
    Remember the saying: if it looks too good to be true it almost certainly is.
    • Malthusian
    • By Malthusian 12th Jan 18, 9:02 AM
    • 4,255 Posts
    • 6,702 Thanks
    Malthusian
    James, have you thought about sending that to the FCA. They are looking at unregulated investments and how they are marketed at the moment.
    Originally posted by dunstonh
    Can you elaborate? I can't see any reason for the FCA to take action in the Facebook ad.

    There appears to be no regulation on promotion of unregulated corporate loan notes and as the investment itself is unregulated, it's essentially not the FCA's problem.

    We've just seen with Park First that if you do run an unregulated collective scheme, which is the FCA's problem, the FCA will helpfully allow you to restructure the investment so it isn't their problem any more. Then take no further action.

    As far as I can see, the FCA's general attitude to unregulated investments is "not our problem". So I would be very interested to know if something else is going on behind the scenes.
    Last edited by Malthusian; 12-01-2018 at 9:05 AM.
    • dunstonh
    • By dunstonh 12th Jan 18, 10:02 AM
    • 93,036 Posts
    • 60,430 Thanks
    dunstonh
    Can you elaborate? I can't see any reason for the FCA to take action in the Facebook ad.
    Unregulated investments have restrictions on how they can be marketed. If they are being marketed in a way that makes them appear like a normal retail deposit, when it cannot be right.

    It was at an FCA roadshow meeting that it was mentioned that they were looking at unregulated investments more closely than previously. However, the audience was mostly IFA. So, it may be that is the extent of their view.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • Malthusian
    • By Malthusian 12th Jan 18, 10:34 AM
    • 4,255 Posts
    • 6,702 Thanks
    Malthusian
    Most of the regulation on promotion of unregulated investments seems to focus on unregulated collective investment schemes, and corpoate loan notes aren't considered a collective investment. (Which is nonsense, but that's UK securities law for you.)

    The only way the ad in this thread could be said to make them appear like a normal retail deposit is the reference to savings, and that's tenuous.

    More to the point, the FCA's prior action on Park First suggests even if it finds that Blackmore's adverts are misleading, the only action it will take will be to tell them to change the adverts. Rather like how the only action the ASA ever takes is to say "the advert must not appear again in its current form" (after the business has already reaped the rewards of showing the illicit advert).
    • dont_use_vistaprint
    • By dont_use_vistaprint 12th Jan 18, 12:12 PM
    • 51 Posts
    • 18 Thanks
    dont_use_vistaprint
    They loan your money in large amounts to established UK companies with asset protection, unlike funding circle, that loan to A-D rated with no assets. Rather than track payments/defaults online you call them to see how it's doing. So its like P2P but on a much bigger scale. There published accounts suggest lenders do not default
    • Malthusian
    • By Malthusian 15th Jan 18, 12:47 PM
    • 4,255 Posts
    • 6,702 Thanks
    Malthusian
    So its like P2P but on a much bigger scale.
    Originally posted by dont_use_vistaprint
    No, it's on a much smaller scale. Funding Circle, just to pick the one you mentioned, has outstanding loans of 1.6 billion. LC&F claim a loan book of 103 million.

    There published accounts suggest lenders do not default
    Borrowers default, not lenders. Pedantry aside, that's not very reassuring. Borrowers do default, otherwise LC&F wouldn't need to charge them interest and therefore wouldn't be able to pay up to 8% per annum to their own lenders.

    Their last accounts are from April 2016 when LC&F was a much smaller outfit (loans of 10 million according to those accounts) so there is very little they can tell us about the current creditworthiness profile of their borrowers.
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