Lendy FCA Registred?

This status started on 02/06/2014, so this is probably their first registration and may not relate to full authorisation.

On email footers it does say " Lendy Ltd is authorised and regulated by the Financial Conduct Authority (FCA), number 654326", but that is exactly what it said last week and FCA is still showing it as Interim Permission.

A firm that has interim permission is authorised to undertake that regulated activity.  As background, the interim permission regime was introduced as a transitional measure to allow firms that where previously undertaking P2P activity under a credit licence, a new regime that regulated both the credit and p2p platform aspects, the later had never been previously regulated.  To prevent disruption to the market, P2P firms that had been operating prior to April 2014 were automatically given interim permission authorising them to operate their p2p activities whilst they applied to obtain full authorisation.  Interim permission remains valid until such time that a firm withdraws its application for full permission or when a decision is given on its application for full permission.  After April 2014, any new p2p firms had no choice but to apply for full authorisation before undertaking any p2p activity. 

The FCA register currently shows that LY has the necessary interim permissions to undertake its regulated P2P activities.  The timeline to obtaining full permission is largely dictated by the FCA.  Firms that had interim permissions were allotted time slots that the FCA had hoped to review, process and ultimately authorise firms. The timing of these slots has slipped considerably (2+ years) as the FCA has taken a lot longer to firm up its views on certain aspects of the sector.

The big distinction between LY's position and COL's previous position, is that it appears that COL did not have the all the required interim permissions for the regulated activity it was undertaking.  In fact, there is a big question mark over whether it had any valid interim permission at any time.  The entity that has gone into administration is Collateral (UK) Limited which was only incorporated in November 2014, ie it could never have been entitled to operate under an interim permission.  Whilst other related entities have been mentioned that did have certain regulatory permissions (none of them relating to operating a p2p platform), such permissions are specific to the legal entity and are not transferable so it remains a mystery on why they thought they had the necessary permissions to operate......

And why, it appears, it took the FCA so long to notice (which I assume they finally did) and act.

The FCA are hopeless. They are funded, I believe, by the companies they authorise. They do not represent the consumer but the companies. I have reported Lendy twice now, to no avail. The ombudsman service , so far , has been appalling. Lendy break the rules and the FCA / ombudsman service turn a blind eye.

FCA authorisation is merely a badge to place on their websites, it offers no protection for the consumer. Do not be fooled, as I was.  The protection is a fantasy. 
     

peterpea , firstly and most importantly getting (and remaining) overly stressed by any situation isn't worth it on health grounds.

The words that dualinvestor has written this morning are pretty fair IMO, and recent events at Collateral show the FCA does act when they become aware that rules are being broken. It is possible that criminal charges are being considered in that case.

The "complaint" that could be levelled at the FCA is that they have failed to recognise that the risks of p2p are too complex to be understood by a proportion of retail lenders to whom p2p is primarily being aimed. The solution is either much starker warnings (you WILL lose capital if this loan defaults, cf smoking kills) or a ban on the promotion of self-select p2p loans to retail lenders.


A RICS valuation is NOT intended to represent what the asset might achieve in a distressed sale (aka firesale) situation.  It is up to you to read the valuation report, do other research and take a realistic view of what an asset may achieve as a speculative auction purchase. Expecting much more than 50% of the open market valuation is a gamble, it could be significantly less as is the case on this loan. Lending at 70% LTV when a distressed sale value might be 50% LTV or less is inevitably going to lead to capital losses, a risk for which you have been paid for taking by accepting a 12% pa notional yield.

The way I evaluate loans is to split the risk categories into those that represent risk of default and those that represent risk of loss on default. I try to avoid lending on loans with a medium/high risk of loss on default unless the risk of default is genuinely close to zero.

Disclosure: I've never been in this loan or any of the other loans to this borrower that are on FS.

So you invested without doing research or rea ding the website then?

All of the relevant statements and warnings are there and always have been.

Everyone knows I am not a supporter of Lendy but by being blinded by the high returns does not mean the FCA or FOS should protect you from your own folly.

EDIT Which particular FCA rules do you allege Lendy have broken? (BTW writing in bright colours does not make your comments more,or less, true but it does tend to indicate a certain paranoia akin to the "green ball point pen"brigade)