star dust
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Post by star dust on Mar 9, 2019 14:34:42 GMT
Apparently an email has been sent out by BDO on Friday 8 th March to cira 30 Collateral investors containing revised "proof of debt statements". It seems likely that only investors with significant amounts of cash on account and/or loans up for sale will have received one. If you haven't received one there is no immediate need for concern. There will be a Creditor's Committee Meeting next week on Tuesday 12 th March, and Monetus will raise this matter, so hopefully more information might be forthcoming. In the meantime there is a discussion thread here and an incredibly helpful explanation of what this is about by nick who's post I am repeating here. I received an email late Friday afternoon advising me off a significantly reduced debt figure. I immediately called BDO to discuss the revised figures, understand their process, and the best way I could respond to substantiate my claim value and help them reconcile the difference against the current info they had derived from the database. I had originally reconciled the initial original proof of debt figure to within 33p and fortunately kept detailed account statements and email transaction confirmations which could substantiate my claim to a high degree of certainty. It was immediately clear that about half the discrepancy was due to cash I had on the platform. BDO stated on the call that as far as the company records showed, I only had 33p in my account versus mid 4 figures per my records - at least I now know why the original debt figure given to me was different to my records by 33p because they didn't bothering including this in the initial proof of debt figure. The key points from my conversation with BDO were: - About 80-85% of all account balances tie back to the original debt figures
- Letters have only been emailed to about 30 investors where the discrepancy is greatest (in absolute £ terms)
- Nearly all the accounts that vary against the original balances given are going against the investor, ie the balances are being revised down.
- They are hoping that investors with discrepancies will respond with detailed support so that they can identify specific/systematic issues with the data they have
- Nothing is going to happen quickly, investors with discrepancies will have plenty of time to respond and engage - this is not going to be a quick process
- Fundamentally the issue they have is that the original balances were just total summary exposures contained in a spreadsheet with no supporting data or allocation across loans. The revised balances is based on some form of underlying data, and more importantly, allows allocation of exposure against specific borrowers and the platform itself (in respect of non-invested cash).
The spreadsheet provided by BDO along side the letter provides a basic breakdown of info, specifically line items of individual amounts invested in each loan and an offsetting "amount_selling" figure which they believe relate to sold loans, with entries for each loan part acquired. However, I believe the "amount selling" column also captures loans that were on sale but had not been sold as at 28 Feb and suspect this will account for the bulk of the remaining variance. In my discussion with BDO I highlighted that the net funds I had invested on the platform (which they should be able to verify by bank records) now exceeded the total exposure (cash and loans) they were now suggesting, and that this was even before factoring in interest and cash back that I had earn't on the platform. When discussing this point, it became clear to me the dilemma BDO have - that the original analysis is worthless to them as they are looking to distribute realisations on a loan by loan basis and so are left relying on the numbers they have pulled from the database which most cases reconcile with the original balances and can allocate exposure to each borrower, but does not tally back to all originally reported exposures for all accounts. I hope that our individual feedback/analysis of discrepancies in reported exposures will collectively help them to reconcile all accounts to the original exposure figures that most investors seem to be in agreement with. I agreed on the call that I would send BDO my detailed statement and my analysis of where the discrepancies in values are coming from so that they can investigate further and hopefully correct their analysis. I suggest everyone else affected does the same, even absent all supporting data, as I suspect that the problem/issues will be common (eg not including loans on sale but weren't sold etc) and should go a long way to helping them fully reconcile the data. The difference in reported cash balance is a major concern as even a rudimentary analysis would show something is far from right. However, I suspect the losses on cash held on the platform will likely suffer the greatest write-off (given the apparent large day one discrepancy in funds held in the client account and after administration fees) so dispute over cash balances held on the platform may end up being a depressingly mute point......
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star dust
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Post by star dust on Mar 13, 2019 11:51:44 GMT
Latest update, thanks to Monetus , on the Creditors Committee Meeting that took place on the 12 th March 2019 The latest Creditors Committee meeting took place yesterday and while it lasted around 5.5 hours virtually all of it was covered by NDA unfortunately. A few things I can say: - There have been a couple of additional recoveries and receivers appointed over a couple of the property loans recently. - The JA’s plan to appoint receivers over further property loans very shortly as negotiations with several borrowers don’t seem likely to reach a positive conclusion. - The JA’s are aware of the issues regarding communications and investor balances for certain members who received an email last week. To confirm the data retrieved is accurate for around 85% of the investor base and it was only a select group of investors (around 30) with a large potential discrepancy who were contacted. The Committee gave feedback in regards to where issues may be arising (i.e. the secondary market) and BDO are in touch with various investors as they work to refine the data retrieved. While I know it's highly frustrating for investors that I can't say a lot, we are now reaching a sensitive time in various aspects of the administration and revealing too much would potentially jeopardise recovery and the overall result achieved.
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star dust
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Post by star dust on Mar 16, 2019 12:37:16 GMT
There is a new FAQ dated the 15 th March on the BDO website. I don't know about anyone else, but I certainly didn't receive any emails about it. Of particular note the next Administrators report will be issued by the 27th April 2019. In Edit: This date may be incorrect and in fact should read 27th May 2019 - p2pindependentforum.com/post/318690/threadContent: "THIS DOCUMENT IS PUBLISHED BY THE JOINT ADMINISTRATORS ON BEHALF OF THE COMPANIES.
THE JOINT ADMINISTRATORS ACT AS AGENTS OF THE COMPANIES AND WITHOUT PERSONAL LIABILITY
Collateral (UK) Limited Collateral Sales Limited Collateral Security Trustee Limited(together, “the Companies”) –All in Administration
Frequently Asked Questions
I completed the “Lender Resolution” circulated by the Joint Administrators on 21 December 2018. What happens now?
The Joint Administrators would like to thank all investors who responded to the Lender Resolution. As investors will recall, the Terms and Conditions governing the contractual relationship between investors and the Companies require investors to pass a Lender Resolution before the Companies can enforce over any security. Such enforcement action may be necessary in circumstances where any borrower is unable or unwilling to repay the outstanding amount due. We are pleased to confirm that the required Lender Resolution has been obtained in respect of all outstanding property loans. This will allow the Joint Administrators to proceed with any necessary enforcement action. In this regard, Receivers have already been appointed over a number of properties held as security against outstanding loans. Why have some investors received a letter asking them to provide further evidence in relation to their exposure to the Collateral platform?As noted in our previous reports to investors and creditors, a key work stream for the Joint Administrators has involved the retrieval and recovery of the electronic data previously stored on the Collateral platform. The information provided to the Joint Administrators at the outset of the administrations (and from which the indicative, pre-completed Proof of Debt forms were prepared) only provided a summary of each investor’s total exposure to the platform, rather than a detailed analysis of each investor’s exposure to specific loans or tranches of loans. Obtaining this analysis from the electronic data is essential, as each investor will have different ‘trust’ claims against the loans into which they invested. We have now extracted, from the recovered electronic data, a detailed analysis of each investor’s exposure to the Collateral platform. For a significant number of investor accounts (some 85% in terms of number), the detailed analysis reconciles exactly to the summary information provided to the Joint Administrators at the outset of the administrations. However, the remaining investor accounts do not currently reconcile. We have recently written to a small number of investors (30) who have the largest discrepancies between the detailed analysis and the summary information balances, in an attempt to identify why such discrepancies have arisen. We have already received some helpful feedback from some of the investors concerned and further work is being carried out to establish whether we can refine the detailed analysis and reconcile the account balances. We will update investors further in due course. Why have I not received an updated schedule of my exposure to the Collateral platform?As noted above, the detailed analysis has only been sent to a small number of investors who have the biggest discrepancies in their account balances. At the current time, the detailed schedules of exposure have not been sent to those investors (i) whose account balances reconcile; or (ii) who have smaller discrepancies. The Joint Administrators intend to provide detailed schedules to all investors once the analysis has been further refined and the remaining accounts have been reconciled. When will I receive the next report from the Joint Administrators?
The next report will be sent to all investors and creditors before 27 April 2019. I understand that the Administrations will end by 27 April 2019, what are the practical implications?The Joint Administrators’ proposals, as previously approved by investors and creditors, provide for the Companies to move from Administration to Creditors’ Voluntary Liquidation at the end of the 12-month administration period. Accordingly, the Joint Administrators will take steps to place the Companies into Creditors’ Voluntary Liquidation before 27 April 2019. In practice, the Joint Administrators will continue to deal with the affairs of the Companies as Joint Liquidators, and will continue their work to realise the Companies’ assets and return funds to investors and creditors."
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star dust
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Post by star dust on Mar 27, 2019 16:58:41 GMT
Thanks to Monetus for an update from BDO - below, and thanks to all those who contacted them about their statements. Monetus has also provided some updates on Collateral loans today p2pindependentforum.com/post/320446/threadand for those with access to DDC - p2pindependentforum.com/post/320414/threadUpdate from BDO received today: "As discussed at our last meeting, we received a significant number of responses to our letters to those investors who had the largest discrepancies between the summary data provided to us at the outset of the administrations, and the detailed analysis extracted from the recovered data. It appears fairly clear that the discrepancies arise as a result of those investors holding investments for sale on the secondary market (where our initial analysis shows such investments as ‘sold’ rather than ‘for sale’), and our IT team is attempting to refine the analysis to resolve this issue. We will provide a further update to the Committee (and the investors concerned) as soon as it is possible to do so."
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star dust
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Post by star dust on Apr 19, 2019 21:38:10 GMT
Date of the next Creditors Committee Meeting Next Committee Meeting date has been set for 18th of June. Questions or issues that Monetus might be able to raise starting here.
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star dust
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Post by star dust on Apr 25, 2019 14:11:00 GMT
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Post by star dust on Jun 19, 2019 11:06:47 GMT
Update kindly provided by Monetus on the June 18 th 2019 Creditors Committee meeting: The Collateral Creditors Committee meeting happened yesterday at 11.30am. Here are a few updates on subjects that I allowed to discuss: - A total of 7 property loans have now been redeemed/settled and BDO have taken enforcement action in relation to a further 7 property loans. - BDO are continuing their efforts to reconcile the discrepancies in the data recovered which affects approximately 15% (by number) of investors. - BDO are in a dialogue with the remaining borrowers and negotiations are ongoing regarding a consensual refinancing of their loans. - In respect of the chattel loans, all of the borrowers have returned their stock, which BDO are having valued and will realise in due course. - BDO are continuing to obtain legal and property advice from Stevens and Bolton for legal matters and Avison Young for property assistance and valuations. - Based on currently available information, it would appear that tranche priority applies in respect of the relevant property loans. - It is currently too early to determine the likely total level of recoveries from the loan books. - BDO will pursue all lines of enquiry to maximise recoveries for investors and creditors. Original post and subsequent discussion starting here.
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star dust
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Post by star dust on Jul 6, 2019 21:11:40 GMT
A summary of the FCA registry issue for Collateral Ltd together with links to threads where this is discussed including information on raising complaints with the FCA. Helpfully duck has provided a potted timeline of Register events quoted below. As regular readers of this thread will know I and others have been working behind the scenes for the past year and a bit concentrating on the FCA's role in the Collateral debacle. Yesterday I received further information from the FCA that allowed me to put the following time line together. Andrew Bailey (head of the FCA) recently referred to the Col case as 'unfortunate' I would use stronger words. The FCA failed from the day that they took funds from Collateral to process a FULL Part 4A approval route. If basic checks had been made at that time it would have highlighted that Col was not eligible for IP. Without the interim to full approval route Collateral would not have been allowed to trade. Regal Pawnbrokers register entry changed to read Collateral 12/12/15. Collateral applied for full Part 4A approval 23/03/16. The FCA started the approval process 'on the basis that it held a valid interim approval'* Cols application remained at 'case assessment stage ' until they called in the administrators. The FCA knew that Col was trading for the whole period from 23/03/16 to 26/02/2018** The FCA became aware on 23/11/2017 that the interim approval that was claimed by Col was invalid. On 29/01/2018 the FCA challenged the directors of Col. On 07/02/2018 Col withdrew its part 4A application. On 12/02/2018 Col agreed to cease trading. Col continued to trade until the screens went blank on 26/02/2018. *Col was never eligible for interim approval this should have been picked up by the FCA. ** This is actually stating the obvious (but I wanted it in writing). To progress from interim to full approval you have to be trading. Main thread – p2pindependentforum.com/post/297278/threadIncluding: FCA complaints process Example of a complaint FCA deferment letter to COL complainants - FOI registry new detail Example of follow-up complaint Treasury Select Committee meeting questions on the FCA register & transcript FCA director of enforcement transcript.
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star dust
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Post by star dust on Aug 7, 2019 17:01:16 GMT
It seems that the FCA updated their disclosure log yesterday - the results of Freedom of Information requests that it is prepared to publish 'in the public interest'. A link to the updated log is here:
There seem to be four entries relating to Collateral UK dated March 2019 that are pertinent, collectively telling a somewhat unbelievable tale of FCA ineptitude - much of this has already been relayed by duck in this post, which was quoted above too - brief summary: 01/04/2014:Regal Pawnbroker Limited (RPL)was added to the IP Register 12/12/2015:name changed to Collateral (UK) Limited.
24/03/2016: Collateral (UK) Limited paid an Application fee of £1500.00 to the FCA. This money was received and not returned when the application was withdrawn by Collateral (UK) Limited. 29/01/18: the FCA requested Collateral to cease carrying on regulated activities for which it did not have authorisation.
12/02/18: Collateral informed the FCA that it would cease carrying on lending activities.
I've put the summaries of the requests below, and included the links to the FCA response documents - well worth the read. I assume the requests were made by duck and the 'lings Date of release | Subject | Reference | Mar-19 | In October 2018 the FCA emailed a questionnaire to the customers of Collateral UK, which had entered administration. I would like to know the following information: | FOI6274 |
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| How many emails were emails were sent by the FCA to Collateral customers? |
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| How many people completed the questionnaire? |
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| Mar-19 | Regarding the information given by the fca "the Collateral Companies agreed to cease their lending activities and, on 26 February 2018, the lending platform became inoperative." | FOI6219 |
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| Please can you advise: |
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| The date that the FCA told Collateral to cease trading and the date that Collateral agreed to cease their lending activities? |
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| Mar-19 | Please supply details (dates and content at a minimum) of all meetings and written communications with Directors or representatives of the following Companies prior to Collateral (UK) Limited placing themselves into Administration. | FOI6216 |
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| a) Collateral (UK) Limited |
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| b) Regal Pawnbroker Limited |
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| c) Regal Pawn Broker Limited |
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| Mar-19 | I would like to know when changes were made to the FCA register entry (including the FCA Interim Permission Consumer Credit Register) for the company with the interim registration code 656714. | FOI6215 |
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| This company was known as Collateral UK and also as Regal Pawnbroker. Can you please detail when changes were made to the register regarding: |
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| a) the name of the company on the registration |
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| b) the permissions of the company |
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| c) any other information displayed on the register |
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star dust
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Post by star dust on Sept 5, 2019 18:40:01 GMT
It seems that the FCA have updated their disclosure log again today - the results of Freedom of Information requests that it is prepared to publish 'in the public interest'. A link to the updated log is here: There seem to be a further six entries relating to Collateral UK dated April 2019 that are pertinent, they add a few more details to the saga - brief summary from all March & April responses:
01/04/2014:Regal Pawnbroker Limited (RPL)was added to the IP Register 12/12/2015:name changed to Collateral (UK) Limited.
24/03/2016: Collateral (UK) Limited paid an Application fee of £1500.00 to the FCA, the fee was for full authorisation. This money was received and not returned when the application was withdrawn by Collateral (UK) Limited (on the 07/02/2019). 23/11/2017: FCA became aware and understood that Collateral UK Limited were using an invalid IP number
29/01/2018: the FCA requested Collateral to cease carrying on regulated activities for which it did not have authorisation, (and told to inform their investors (date not specified))
07/02/2018: Collateral withdrew their application for full FCA authorisation
12/02/2018: Collateral informed the FCA that it would cease carrying on lending activities.
I've put the summaries of the latest published (April 2019) requests below, and included the links to the FCA response documents. I assume the requests were made by duck and the 'lings Date of Release | Subject | Reference | April 2019
| In the FCA's statement 'Information for investors in the Collateral Companies' dated 04/04/2018 the FCA stated "In fact, none of the Collateral Companies held any valid authorisation or permission to carry on regulated activities." | FOI6297 |
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| On what date did the FCA become aware that Collateral (UK) Ltd was trading without valid authorisations / permissions? |
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| On 28th April 2018 BDO were appointed as the 'new' administrators at the request of the FCA. |
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| What actions did the FCA take subsequent to discovering that Collateral (UK) Ltd was trading without valid authorisations / permissions apart from having BDO appointed? |
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| The statement states "the Collateral Companies agreed to cease their lending activities" how was this communicated and on what date? |
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| Did the FCA take any action to preserve data following the Collateral Companies agreeing to cease their lending activities? |
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| April 2019
| To quote information from the FCA website 27/4/2018 "none of the Collateral Companies held any valid authorisation or permission to carry on regulated activities. When challenged by the FCA....... " | FOI6298 |
| Please can you advise the date the fca challenged them as stated on you (sic) website” |
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| April 2019 | Has Collateral (UK) Ltd ever appeared on the list of 'Unauthorised firms and Individuals'? | FOI6346
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| www.fca.org.uk/consumers/unauthorised-firms-individuals |
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| Have any of the directors of Collateral (UK) Ltd ever appeared on the list of 'Unauthorised firms and Individuals'? |
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| April 2019 | Did Collateral UK withdraw their application for FCA authorisation on or before the FCA requested them to cease trading? | FOI6344 |
| Did the FCA instruct Collateral UK to withdraw their application? |
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| Did the FCA check their register at the time Collateral uk withdrew their application? |
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| Did the FCA instruct Collateral UK to inform the 1,000 s of Investors? |
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| April 2019 | In your response to me (Your Ref: FOI6216) you stated "This money was received and not returned when the application was withdrawn by Collateral (UK) Limited." | FOI6345 |
| Please confirm: |
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| 1. the application was for interim approval (and if it was not what the application was for) |
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| 2. the date on which the application was withdrawn
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| April 2019 | In 2016 Collateral UK Limited made an application with the FCA using IP 656714. | FOI6347 |
| In April 2018 the FCA release a statement stating "none of the Collateral Companies held any valid authorisation or permission to carry on regulated activities" |
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| 1. Can you confirm that the application Collateral UK Limited made in 2016 was for Full Authorisation. If not what was the purpose of the application. |
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| 2. Can you confirm when the FCA became aware and understood that Collateral UK Limited were using an invalid IP number for that company. |
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| 3. Can you confirm what action was taken to protect consumers and what date these actions ocurred, at the time the FCA became aware of the IP discrepancy with Collateral UK. |
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star dust
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Post by star dust on Oct 24, 2019 12:59:13 GMT
Not entirely sure this can be classified as a 'significant' update a mere 18 months into administration, but this is an update of the Creditor's Committee meeting (from one of it's members) that took place with the administrators BDO on the 23 rd October 2019. Note: Blue text my addition for sense of edited post - here. 1. The database has been recovered and all accounts reconciled. 2. The chattels loans - They have been valued but not sold. An appropriate disposal strategy is being formulated. I am unable to disclose value or any further details. 3. BDO have suggested there should be interim payments once there are sufficient recoveries. i.e. we won't have to wait until the very end. I won't be able to comment any further on today's Collateral meeting other than progress is being made in regards to various recoveries.
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star dust
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Post by star dust on Dec 23, 2019 10:55:03 GMT
What is it they say about bad news……. No email received (yet?) by me at least, contents quoted below.
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star dust
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Post by star dust on Dec 23, 2019 14:27:01 GMT
In more evidence of it being a good day to bury bad news ....... for those who have made an FCA complaint about Collateral, an email from the FCA has been sent out this afternoon (timed 13:28 in my in-box) with the not unexpected news of a further deferment Also noted here - p2pindependentforum.com/post/362071/thread
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star dust
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Post by star dust on May 14, 2020 17:25:07 GMT
Just brought to my attention, another highly pertinent FOI response. I've just noticed that the FCA sneaked another Col FOI into their 2019 disclosure log. Another one for your excellent list star dust FOI6927This was a very important FOI since it closed another question that had been nagging me for a long time. We know from the rules that for Interim Approval (IP) to be given the company had to be incorporated before a certain date, Col was not. This information was available to the FCA at Companies House from the date that the Part 4A application was made. The FCA and Col were 'in discussions' for the best part of 2 years before 23/11/2017 with Col claiming IP / not needing IP but at no time until 23/11/2017 did the FCA carry out such a basic check, they took Part 4A applications on trust! FWIW this FOI is one of the last I sent, there are plenty more that I and others sent that are yet to be published on the disclosure log, somehow I doubt if they will all be since the FCA only publish a selection.
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star dust
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Post by star dust on Jun 19, 2020 21:13:09 GMT
For the record, I understand all Collateral investors should start receiving emails from BDO from today onwards setting out their holdings on the platform at the date of receivership 28th February 2018. I received mine this evening and it contained the following quoted text plus two attachments, a pdf with general borrower and loan information and a second excel spreadsheet with personalised loan holding information.
Note: On a personal basis about 10% of my supposed holding is unreconcilable or should that be unrecognisable - I'm about to start wading through some of dan1 's loan-books to see if I can make any more sense of it. I wonder if I am one of the 10
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