michaelc
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Say No To T.D.S.
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Post by michaelc on Mar 23, 2018 13:42:52 GMT
I was going to post about how my "gut" feeling was 100% return on cash in account and 50% recovery of loans. Then my cup half full brain got the better of me with a couple of nagging doubts:
Could someone more knowleable than I stop the following nightmare scenarios in their tracks? Are they possible? Likely?
A/ If COL wasn't authorized to lend or collect debt, it still isn't. Could that mean a doomsday scenario of all borrowers simply not being asked to return any capital?
B/ Almost as bad, if the administrator is only interested in creditors of COL of which we are not, then is it quite possible there will not be any arrangements put in place to collect repayments and make distributions?
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Post by rookyone on Mar 23, 2018 13:44:41 GMT
Like in many cases this is a perverse incentives situation in which the Administrator has no incentive to expedite the process and all incentives to sit around and rack up the billing hours as much as they can. Correct me if I am wrong. I have seen administrators get a job done and dusted quite swiftly on occasions. Normally if they are selling the business back to the owner on a pre-pack whilst dumping all the debt. Or where they find there's not much money or realisable assets in the company so they have to get a move on and get out. If there's money or realisable assets in the administration at the start you can bet that the administrators will be around long enough to take a generous slice of it. Interesting article in one of yesterday's daily newspapers on the accountants dealing with the Carillion collapse. Head Accountant: £865 an hour Support Staff: £360 an hour With a caveat of they are one of the first in line when the money is dished out. One may just think that in this kind of profession it can at times pay extremely well to procrastinate...
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mason
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Post by mason on Mar 23, 2018 14:14:27 GMT
I was going to post about how my "gut" feeling was 100% return on cash in account and 50% recovery of loans. Then my cup half full brain got the better of me with a couple of nagging doubts: Could someone more knowleable than I stop the following nightmare scenarios in their tracks? Are they possible? Likely? A/ If COL wasn't authorized to lend or collect debt, it still isn't. Could that mean a doomsday scenario of all borrowers simply not being asked to return any capital? B/ Almost as bad, if the administrator is only interested in creditors of COL of which we are not, then is it quite possible there will not be any arrangements put in place to collect repayments and make distributions? Responses in this thread made over the past 24 hours would go some way to assuaging some of your doubts. The administrator has expressed a desire to run down the loan book in the manner we have come to understand was intended in the event of the demise of the platform. The FCA, however, will have significant influence over what actually happens, and this situation is unprecedented.
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Post by dualinvestor on Mar 23, 2018 14:18:56 GMT
I have seen administrators get a job done and dusted quite swiftly on occasions. Normally if they are selling the business back to the owner on a pre-pack whilst dumping all the debt. Or where they find there's not much money or realisable assets in the company so they have to get a move on and get out. If there's money or realisable assets in the administration at the start you can bet that the administrators will be around long enough to take a generous slice of it. Interesting article in one of yesterday's daily newspapers on the accountants dealing with the Carillion collapse. Head Accountant: £865 an hour Support Staff: £360 an hour With a caveat of they are one of the first in line when the money is dished out. One may just think that in this kind of profession it can at times pay extremely well to procrastinate... Agree with the sentiment of the comment but most IPs are more professional than that and eventually they have to publish in some detail the time spent by whom (in terms of job title not individual) and doing what. Also those are charge out rates for one of the big four firms of accountants, that's the good news. Refresh Recovery's rates should be nowhere near that level, another bit of good news, but they exclude VAT which is not recoverable in the case of Collateral so that cancels the good news a little.
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sildenafil
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Post by sildenafil on Mar 23, 2018 14:45:47 GMT
I was going to post about how my "gut" feeling was 100% return on cash in account and 50% recovery of loans. Then my cup half full brain got the better of me with a couple of nagging doubts: Could someone more knowleable than I stop the following nightmare scenarios in their tracks? Are they possible? Likely? A/ If COL wasn't authorized to lend or collect debt, it still isn't. Could that mean a doomsday scenario of all borrowers simply not being asked to return any capital? B/ Almost as bad, if the administrator is only interested in creditors of COL of which we are not, then is it quite possible there will not be any arrangements put in place to collect repayments and make distributions? If the borrowers don't pay then 'Collateral' still hold the first charge on the property/vehicle/jewellery items etc. so can all be sold and proceeds distributed to lenders in the same way if they were still running the platform
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littleoldlady
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Running down all platforms due to age
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Post by littleoldlady on Mar 23, 2018 15:05:09 GMT
I was going to post about how my "gut" feeling was 100% return on cash in account and 50% recovery of loans. Then my cup half full brain got the better of me with a couple of nagging doubts: Could someone more knowleable than I stop the following nightmare scenarios in their tracks? Are they possible? Likely? A/ If COL wasn't authorized to lend or collect debt, it still isn't. Could that mean a doomsday scenario of all borrowers simply not being asked to return any capital? B/ Almost as bad, if the administrator is only interested in creditors of COL of which we are not, then is it quite possible there will not be any arrangements put in place to collect repayments and make distributions? If the borrowers don't pay then 'Collateral' still hold the first charge on the property/vehicle/jewellery items etc. so can all be sold and proceeds distributed to lenders in the same way if they were still running the platform Anybody know the legal position if a charge holder, as a person, is dead or, as a company, is in administration or has been wound up?
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hendragon
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Post by hendragon on Mar 23, 2018 15:24:28 GMT
perhaps we should bear in mind that Col did have interim permission from the FCA which lapsed. Surely then any loans granted under this permission should be legally valid?
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hendragon
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Post by hendragon on Mar 23, 2018 15:37:25 GMT
Thinking further if Michaelc's doomsday scenario (a) were to be true it would be unwise to invest in any platform, be it brokerage, p2p, or whatever that is regulated by the FCA and not covered by the FSCS. Should FCA permission be withdrawn from such organisations for any reason then investors would lose all monies as a possible scenario would kill off a lot of platforms, not just in p2p.
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mason
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Post by mason on Mar 23, 2018 15:51:35 GMT
perhaps we should bear in mind that Col did have interim permission from the FCA which lapsed. Surely then any loans granted under this permission should be legally valid? Is it definitely known that Col held valid interim permission for P2P lending?
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hazellend
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Post by hazellend on Mar 23, 2018 15:57:15 GMT
Oh man this thread is spiraling into a pit of despair, blatantly misinformed comments, and negative speculation. Pretty much par for course with the skittish P2P crowd  |
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mason
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Post by mason on Mar 23, 2018 16:00:09 GMT
Thinking further if Michaelc's doomsday scenario (a) were to be true it would be unwise to invest in any platform, be it brokerage, p2p, or whatever that is regulated by the FCA and not covered by the FSCS. Should FCA permission be withdrawn from such organisations for any reason then investors would lose all monies as a possible scenario would kill off a lot of platforms, not just in p2p. I don't really see a distinction between investments covered by the FSCS and those that are not. FSCS only pays out on claims relating to Authorised Firms. If the FCA determines that the firm is unauthorised, then it cannot be assumed that the FSCS would apply. Where a firm is correctly authorised, the FCA would pursue enforcement action rather than just withdrawing authorisation.
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nyneil
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Post by nyneil on Mar 23, 2018 16:01:41 GMT
perhaps we should bear in mind that Col did have interim permission from the FCA which lapsed. Surely then any loans granted under this permission should be legally valid? Is it definitely known that Col held valid interim permission for P2P lending? Yes, they were operating under Interim Permission which has now lapsed. FCA website is showing : Status: No longer authorised (Reference number: 647161) This is a firm that can no longer provide regulated products and services, but was previously authorised by the PRA and/or FCA
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Post by dualinvestor on Mar 23, 2018 16:06:10 GMT
If the borrowers don't pay then 'Collateral' still hold the first charge on the property/vehicle/jewellery items etc. so can all be sold and proceeds distributed to lenders in the same way if they were still running the platform Anybody know the legal position if a charge holder, as a person, is dead or, as a company, is in administration or has been wound up? The situation with regard to the charge remains the same if the chargeholder dies or in the case of a company goes into Administration/Receivership/Liiquidation. The ONLY change is that the person enforcing it is the personal representative in the case of a deceased person or the appropriate office holder for a company. It is important to note that being a particular office holder gives you no additional rights e.g. if the loan and accompanying charge was for 25 years that is still the term and, unless specified in the original agreement otherwise, it has to be honoured and collection has to wait whatever period remains (even if it is 24yrs 11 months). The appointment oof a office holder does not rectify any defects in the loan agreement/charge. If a company is fully wound up its rights revert to the crown “bona vacantia”
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mason
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Post by mason on Mar 23, 2018 16:07:03 GMT
Is it definitely known that Col held valid interim permission for P2P lending? Yes, they were operating under Interim Permission which has now lapsed. FCA website is showing : Status: No longer authorised (Reference number: 647161) This is a firm that can no longer provide regulated products and services, but was previously authorised by the PRA and/or FCA Those permissions are for "The Collateral Loan Company Limited". It is a different company. This thread relates to Collateral (UK) Limited. It was the permissions issued to Regal Pawnbroker Limited, Reference Number 656714 that Collateral (UK) Limited displayed on the website prior to February. It appears those permissions did not include permissions relating to operating a P2P platform. It may also be the case that those permissions were non-transferable between the two separate businesses, since the authorisation was transferred back to Regal prior to being marked lapsed.
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macro
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Post by macro on Mar 23, 2018 16:14:31 GMT
perhaps we should bear in mind that Col did have interim permission from the FCA which lapsed. Surely then any loans granted under this permission should be legally valid? Is it definitely known that Col held valid interim permission for P2P lending? To further speculate, if Collateral did not hold valid interim permission for P2P lending, does that mean that any loans made during this period are not legally valid? I do wish the FCA would step up and clarify some of the many questions raised in the past 57 pages. Better still if they had policy in place initially. These are uncharted waters indeed.
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