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  • FIRST POST
    • caldi9
    • By caldi9 11th Aug 18, 9:40 PM
    • 71Posts
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    caldi9
    SHOCKED - broker executed trades, but missed bookings in cash statement
    • #1
    • 11th Aug 18, 9:40 PM
    SHOCKED - broker executed trades, but missed bookings in cash statement 11th Aug 18 at 9:40 PM
    Ladies / Gents,

    I did a simple calculation to see what my YTD return is. There was a material difference and the broker forgot to book 3 (!) separate items as cash inflow:

    - I sold a stock twice which the broker did not book as cash inflow
    - The broker did not book 2 separate dividends

    In total, the value of the non-booked (but executed) cash items is 30,000!

    Has anyone ever experienced anything like this? Should I take a lawyer? Could I get something out of this?

    Thanks
    Last edited by caldi9; 11-08-2018 at 9:50 PM.
Page 1
    • NewShadow
    • By NewShadow 11th Aug 18, 9:44 PM
    • 3,361 Posts
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    NewShadow
    • #2
    • 11th Aug 18, 9:44 PM
    • #2
    • 11th Aug 18, 9:44 PM
    What material harm have you suffered?
    That sounds like a classic case of premature extrapolation.

    House deposit: 26% = 26,000 + 800pm * 9 months = 33,000

    Goal: Keep the bigger picture in mind...
    • caldi9
    • By caldi9 11th Aug 18, 9:47 PM
    • 71 Posts
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    caldi9
    • #3
    • 11th Aug 18, 9:47 PM
    • #3
    • 11th Aug 18, 9:47 PM
    Harm? I sold stocks (value of portfolio down) and they did not adjust the cash balance (no cash in). In other words, 30k are missing.
    • masonic
    • By masonic 11th Aug 18, 9:51 PM
    • 10,301 Posts
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    masonic
    • #4
    • 11th Aug 18, 9:51 PM
    • #4
    • 11th Aug 18, 9:51 PM
    It won't be necessary to get a lawyer involved at this stage. Why not contact them and point out the error? They will probably sort it out pretty quickly.
    • caldi9
    • By caldi9 11th Aug 18, 9:56 PM
    • 71 Posts
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    caldi9
    • #5
    • 11th Aug 18, 9:56 PM
    • #5
    • 11th Aug 18, 9:56 PM
    It happened 3 months ago and I only found out now. I think it is unacceptable and I will certainly notify the FCA. Not booking 3 items totalling a material amount is not an error. This should not happen at all and I should not be the one finding it out myself. It is one of the larger providers and I would like to know how many people get cheated like this. I received the booking executions, but just not the cash. It is fraud, nothing else.
    • masonic
    • By masonic 11th Aug 18, 10:04 PM
    • 10,301 Posts
    • 7,652 Thanks
    masonic
    • #6
    • 11th Aug 18, 10:04 PM
    • #6
    • 11th Aug 18, 10:04 PM
    Not booking 3 items totalling a material amount is not an error. This should not happen at all and I should not be the one finding it out myself. It is one of the larger providers and I would like to know how many people get cheated like this. I received the booking executions, but just not the cash. It is fraud, nothing else.
    Originally posted by caldi9
    You are stating that it is fraud. Do you have evidence of this?

    Which platform is it? If your allegation is factually correct, you need not fear being pursued for libel.
    • caldi9
    • By caldi9 11th Aug 18, 10:11 PM
    • 71 Posts
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    caldi9
    • #7
    • 11th Aug 18, 10:11 PM
    • #7
    • 11th Aug 18, 10:11 PM
    Very simple: you sell shares and do not get the money for that. And that happened in several instances. I am not stuck on legal terms here, but it is illegal under the eyes of the FCA and at the expense of the consumer. Call it fraud or call it betraying customers for hard cash.

    I would not post here on a Saturday evening, if I had not found out 30k are missing in my account.
    • mije1983
    • By mije1983 11th Aug 18, 10:12 PM
    • 3,553 Posts
    • 20,284 Thanks
    mije1983
    • #8
    • 11th Aug 18, 10:12 PM
    • #8
    • 11th Aug 18, 10:12 PM
    It is fraud, nothing else.
    Originally posted by caldi9

    Yes, because humans are perfect and never make mistakes so fraud is the only explanation

    • caldi9
    • By caldi9 11th Aug 18, 10:13 PM
    • 71 Posts
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    caldi9
    • #9
    • 11th Aug 18, 10:13 PM
    • #9
    • 11th Aug 18, 10:13 PM
    I was actually asking, if anyone has come across a similar instance and what a recommendation would be in terms of compensation.
    • caldi9
    • By caldi9 11th Aug 18, 10:14 PM
    • 71 Posts
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    caldi9
    Yes, because humans are perfect and never make mistakes so fraud is the only explanation
    Originally posted by mije1983
    Did you do it 3 times? Was the change 30k? Were you regulated by the FCA? What a silly response.
    • NewShadow
    • By NewShadow 11th Aug 18, 10:16 PM
    • 3,361 Posts
    • 14,507 Thanks
    NewShadow
    Harm? I sold stocks (value of portfolio down) and they did not adjust the cash balance (no cash in). In other words, 30k are missing.
    Originally posted by caldi9
    So, at the moment, 30k is not showing in your account as cash.

    What were you expecting to happen to the cash - were you leaving it to sit as cash in the portfolio, or were you expecting it to be paid out/reinvested?

    Are you sure this isn't just an error with the record you are looking at and that the cash is actually missing?
    That sounds like a classic case of premature extrapolation.

    House deposit: 26% = 26,000 + 800pm * 9 months = 33,000

    Goal: Keep the bigger picture in mind...
    • caldi9
    • By caldi9 11th Aug 18, 10:18 PM
    • 71 Posts
    • 0 Thanks
    caldi9
    So, at the moment, 30k is not showing in your account as cash.

    What were you expecting to have happen to the cash - were you leaving it as cash in the portfolio or were you expecting it to be paid out/reinvested?

    Are you sure this isn't just an error with the record you are looking at and that the cash is actually missing?
    Originally posted by NewShadow
    I checked all the executed trades and compared it to the cash statement. I have a concentrated portfolio and do not trade a lot, hence found the mistake easily. Basically, they did not book the cash inflow from the sale of stocks and they forgot to book dividends as well. Imagine I was an elderly person and a big chunk of my savings were not correctly booked. I cannot be the only one and I know many people do not even check the cash in-/outflows in their SIPPs/ISAs/Portfolios.
    Last edited by caldi9; 11-08-2018 at 10:22 PM.
    • mije1983
    • By mije1983 11th Aug 18, 10:27 PM
    • 3,553 Posts
    • 20,284 Thanks
    mije1983
    Did you do it 3 times? Was the change 30k? Were you regulated by the FCA? What a silly response.
    Originally posted by caldi9

    Almost as silly as your 'it's fraud, nothing else' comment.

    If you truely believe that, why are you asking for compo? You need to go to Action Fraud.

    https://www.actionfraud.police.uk/report_fraud


    Being FCA regulated doesn't make people perfect. People make mistakes. As masonic said, what evidence do you have that it was fraud?
    Last edited by mije1983; 11-08-2018 at 10:32 PM.

    • Alexland
    • By Alexland 11th Aug 18, 10:42 PM
    • 3,830 Posts
    • 3,134 Thanks
    Alexland
    I was actually asking, if anyone has come across a similar instance and what a recommendation would be in terms of compensation.
    Originally posted by caldi9
    I would start by nicely asking them to correct the error. If the cash account pays interest then ask for that too. If they do this promptly and you have therefore not suffered any loss then its hard to see grounds for compensation being due.

    Alex
    Last edited by Alexland; 11-08-2018 at 10:44 PM.
    • sjp999
    • By sjp999 11th Aug 18, 10:46 PM
    • 107 Posts
    • 80 Thanks
    sjp999
    Never attribute to malice what can be more easily explained by stupidity (thanks to whoever I stole that from).

    A calm conversation on Monday morning will hopefully get the ball rolling, once you get hold of somebody sufficiently up the food chain I'd think this will be resolved without too much hassle.
    • msallen
    • By msallen 12th Aug 18, 5:34 AM
    • 926 Posts
    • 1,076 Thanks
    msallen
    Don't forget to come back and update us all when you discover that you've made a mistake and everything is correct after all.
    • G_M
    • By G_M 12th Aug 18, 6:02 AM
    • 46,169 Posts
    • 55,882 Thanks
    G_M
    I understand completely that on discovering 30K of your money has 'gone astray' you are upset/angry/worried.

    But you are over-reacting.

    Fraud requires intent. So yes, if the company (or individual within the company) deliberately acted to deprive you of this 30K in order to benefit themselves (the company or individual), then that would be fraud. You (or the police) would have to prove it was deliberate.

    But as others have said, if it was an error, that is not fraud.

    It would, however, be extremely poor business practice/customer service, possibly requiring the attention of the FCA.

    I suspect, however, (I've not checked) that the FCA would require you to exhaust the company's internal complaints process before they would investigate.

    So, again as others have suggested, your first action, on Monday, should be to raise a complaint. Not just a call to the call centre - look up their formal complaints procedure and follow that.

    Compensation?
    My guess is that when you raise a complaint they will
    *investigate
    * confirm the error (assuming you're right)
    * apologise
    * send you the 30K
    * send you an additional amount as a 'goodwill gesture'

    My guess also is that the 'goodwill gesture' will be more than the amount you could legally claim in compensation which would be your lost interest on 30K:

    Say 1.5% interest (generous)? 30,000 x 1.5% = 450 per annum
    So 450/12 = 37.50 per month
    x 3 months = 112.50
    Last edited by G_M; 12-08-2018 at 6:04 AM.
    • bowlhead99
    • By bowlhead99 12th Aug 18, 7:40 AM
    • 8,307 Posts
    • 15,197 Thanks
    bowlhead99
    Not booking 3 items totalling a material amount is not an error.
    Originally posted by caldi9
    Correctly booking 3 items totalling a material amount is not an error.

    Not booking 3 items totalling a material amount, is an error.

    What you mean is, you suspect the error was made on purpose rather than being accidental. In other words they deliberately didn't book the dividends or sales proceeds, and intend to keep those amounts for themselves rather than applying them to your account.


    This should not happen at all and I should not be the one finding it out myself.
    Correct, it shouldn't happen as the generation of the contract note and dividend voucher should, in an ideal world, feed into the account postings or vice versa. But here they appear to be independent processes and only one part of the process has occurred. The other leg needs fixing.

    Still, if you're going to claim that fraud has occurred you would need to be clear that the money has been lost. Rather than the money still being in the account, but failing to show on the transaction history report and available balance.

    It is one of the larger providers and I would like to know how many people get cheated like this.
    "cheated" is quite strong language when you haven't determined whether they maliciously took your money, nor that if you closed your account, the money wouldn't be received. You might be right that the money isn't on the account so wouldn't be received if you closed the account, but that still doesn't mean they deliberately sought to deprive you of it.

    Perhaps one of the processes wasn't run because the person who was supposed to run it was affected by a hangover picked up on the bank holiday long weekend and not thinking clearly. Or was stressed on a Friday afternoon being about to leave for a package holiday with the kids and hadn't packed yet. So failure to book the transaction was a lack of competence rather than an act of malice.
    It is fraud, nothing else.
    That's your conclusion having considered all the possible options that your imagination could come up with, and eliminating them all until fraud was the only one left. Perhaps that is a lack of imagination on your part .

    Instead of, "It is fraud, nothing else", it's rather more correct to say "It is fraud, or something else".

    Should I take a lawyer?
    Only if they refuse to credit the proceeds after you query it, which would be incredibly unbelievable. So you will have the money "back" at no cost to yourself and a lawyer would only create cost to yourself.
    Could I get something out of this?
    Once you have highlighted the issue and they have fixed the error in your report, there will be no financial loss, so it depends what 'something' you are looking to obtain. If you tell them that your discovering over the weekend that some funds had not been credited was something that gave you significant worry, heartache and mental anguish, and caused you to waste 40 minutes of your Saturday night on an investment forum soliciting opinions on how to deal with a potential fraud by a service provider, they may send you 25-50 by way of apology.

    If the correction of your account and strength of the apology is not satisfactory, you can take it to the financial ombudsman service "after* exhausting their complaints process. The ombudsman won't consider your complaint until the complaints process of the broker has been used and has come to an end (or after 8 weeks, whichever is earlier).

    When the ombudsman considers your complaint and sees that the problem has now been fixed, they will suggest a solution which will put you back in the same financial position as if the mistake hadn't been made in the first place, which will result in you getting a further 0 if you are already in the correct position. Perhaps it will result in something if the provider makes a mistake in backdating any interest they owe on the cash that should have been sitting idle in your account. However, the interest rate on such accounts is typically zero percent or something very nominal, so it's unlikely there is much scope for the broker to miscalculate by a material amount.

    Notifying the FCA will achieve nothing because they don't deal with the public's complaints about service providers. Instead they will refer you to the broker's own complaints process, telling you to follow it up with FOS if you're not satisfied at the end of that process.

    If you do end up contacting the FOS for a ruling because the complaints process at the broker doesn't result in your problem being fixed, it will cost the broker circa 500 (paid to the FOS rather than to you) as a charge to help fund the FOS's operations based on number of complaints investigated. It will also cost the broker some time, corresponding with the FOS to confirm that they did indeed correct your account and ensured you weren't out of pocket.

    As the broker will want to make sure they hit their profit targets (making same amount of profits they would have done if they didn't have the expense of dealing with the FOS), they will likely pass on the expense of such time and fees to their customers through increased fees in future years. So you may decide the knee-jerk reaction of getting the FOS involved is not warranted, if your complaint is adequately dealt with.

    It's unlikely you will need to contact the FOS. Once you lodge a formal complaint with the broker, the broker will get it fixed. If there was indeed a real fraud (ie rather than being a processing mistake, some member of staff has been syphoning off cash transactions from customer accounts to their own account to build a pot of money to fund a permanent vacation to South America), the broker will be grateful for you raising the complaint, though they are unlikely to tell you that's what occurred.
    Last edited by bowlhead99; 12-08-2018 at 7:43 AM.
    • Alexland
    • By Alexland 12th Aug 18, 8:27 AM
    • 3,830 Posts
    • 3,134 Thanks
    Alexland
    If you tell them that your discovering over the weekend that some funds had not been credited was something that gave you significant worry, heartache and mental anguish, and caused you to waste 40 minutes of your Saturday night on an investment forum soliciting opinions on how to deal with a potential fraud by a service provider, they may send you 25-50 by way of apology.
    Originally posted by bowlhead99
    Do we get 5 each compensation for reading all these accusations of fraud?

    Alex
    • caldi9
    • By caldi9 13th Aug 18, 8:52 AM
    • 71 Posts
    • 0 Thanks
    caldi9
    Update: the bookings were an error and will be fixed. I suggest you check your cash statements if you invest into single name stocks. It can make a 30k difference.
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