blender
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Post by blender on May 9, 2018 9:16:59 GMT
huxs. The loans in force are not company money, but if they are wound down under administration and there is no cash in the company to cover the cost of that work, then there is a problem. The security has to be released to the borrowers for them to make the repayment of capital. The client money? Yes, the evidence suggests that you are being naïve.
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11025
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Post by 11025 on May 9, 2018 9:27:33 GMT
huxs. The loans in force are not company money, but if they are wound down under administration and there is no cash in the company to cover the cost of that work, then there is a problem. The security has to be released to the borrowers for them to make the repayment of capital. The client money? Yes, the evidence suggests that you are being naïve.
So technically it is possible that if an administrator needs funds to continue then they could wait for a loan to reach term end , then once paid back use what funds they need ?
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Post by brightspark on May 9, 2018 10:57:58 GMT
I share everyone else's concerns that our funds may be at risk. Lenders and repaying borrowers funds never belonged to Col. Terms and conditions meant that, by contracts, Col introduced lenders to borrowers and took a commission on this provision. It is immaterial in this respect that this activity was not but should have been FCA Regulated or where money on account was lodged. If the funds did not belong to Col I do not think that Administrators have the right to dip into such funds without the agreement of lenders. This they will seek the argumentation being that without substantial finance the Administration process will not be able to proceed anything like expedititiously. I suggest shortly BDO will be telling us what they propose in a similar line to Beaufort Securities where uproar has been caused amongst investors by the gargantuan 20% Price Waterhouse Coopers want.
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11025
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Post by 11025 on May 9, 2018 11:31:56 GMT
I share everyone else's concerns that our funds may be at risk. Lenders and repaying borrowers funds never belonged to Col. Terms and conditions meant that, by contracts, Col introduced lenders to borrowers and took a commission on this provision. It is immaterial in this respect that this activity was not but should have been FCA Regulated or where money on account was lodged. If the funds did not belong to Col I do not think that Administrators have the right to dip into such funds without the agreement of lenders. This they will seek the argumentation being that without substantial finance the Administration process will not be able to proceed anything like expedititiously. I suggest shortly BDO will be telling us what they propose in a similar line to Beaufort Securities where uproar has been caused amongst investors by the gargantuan 20% Price Waterhouse Coopers want. I concur with your thoughts ,
What I am hoping is this situation doesn't mean that the piss can be taken at the investors' expense
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macro
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Post by macro on May 9, 2018 11:39:20 GMT
I share everyone else's concerns that our funds may be at risk. Lenders and repaying borrowers funds never belonged to Col. Terms and conditions meant that, by contracts, Col introduced lenders to borrowers and took a commission on this provision. It is immaterial in this respect that this activity was not but should have been FCA Regulated or where money on account was lodged. If the funds did not belong to Col I do not think that Administrators have the right to dip into such funds without the agreement of lenders. This they will seek the argumentation being that without substantial finance the Administration process will not be able to proceed anything like expedititiously. I suggest shortly BDO will be telling us what they propose in a similar line to Beaufort Securities where uproar has been caused amongst investors by the gargantuan 20% Price Waterhouse Coopers want. In the event that BDO propose doing a Beaufort number on us poor investors, what collective leverage do we have? Recourse to the judge? In-house (P2P IF) legal advice? Paid-for advice? I fear that some of the more-experienced investors that once frequented this esteemed establishment may have departed / deported to another venue
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Post by mrclondon on May 9, 2018 11:49:34 GMT
I'm struggling to see significant differences between how the administrator will deal with an overdue loan (now a majority of the loans on COL), and how a platform would deal with it. Whilst clearly there is some administrator or platform overhead involved (which in the latter case would be covered by the platform, in the former needs to be retrieved from somewhere) the majority of the costs associated with a loan recovery are third party services (borrower administrator / receiver fees, estate agency fees, legal fees, auction fees, valuation fees etc) and these are always recovered by the platform out of the recovery proceeds before distribution to p2p lenders. (In practise the borrower administrator/receiver remits the recovered funds after deducting their fee & all costs). There should be no difference in this respect whether the platform or platform's administrator has initiated the recovery.
I've not studied the Beaufort case, but I wonder whether the headline "fee" being banded about is actually the sum of the administrators own fee, and those fees they will be charged by third parties to wind down the scheme.
To be clear, I am not seeking to downplay concerns about how much the wind down of COL could eventually cost, merely stating I don't think BDO's own fees will form a significant part of the costs. We are in an unusal situation in which its possible a significant proportion of the loans will need to go through a formal recovery process rather than being redeemed in full (including any accrued interest/fees) simply because the typical p2p borrower struggles to secure mainstream finance.
BDO's own fees will have court oversight, but I feel this could be a red herring as the bulk of the costs will likely be third party fees, which WILL come out of the recovery proceeds of the corresponding loan.
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blender
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Post by blender on May 9, 2018 12:51:40 GMT
Yes, the handling by an administrator will be the same as the handling by a platform. I was not suggesting this would be a large cost, just that the cost of the admin would have to be found. On the idea of recovery, surely these loans cannot be defaulted, because the borrowers have not broken the contract. If anyone it will be Coll which breaks contracts by not providing the opportunity to the borrowers to make repayment and recover their security. The bling will have to be returned to the owners on payment of the principal - without extra interest if it has gone beyond term. The property borrowers will presumably be already rearranging a refinance to be brought into effect when Coll (or whoever) is in a position to release the charges (for those which have gone past term). Both lenders and borrowers are innocent parties in this situation - provided that the borrowers keep making the contractual payments.
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Post by mrclondon on May 9, 2018 13:08:27 GMT
On the idea of recovery, surely these loans cannot be defaulted, because the borrowers have not broken the contract. I think its more a case they can't be defaulted (yet) because a formal demand for repayment won't have been issued by the administrors (or COL for those loans with maturity dates before 28/2/18). If a borrower can demonstrate that they had funds available on the due date to repay, and repayment was refused by the administror then agreed, they wouldn't be at fault. However, the court action mid March that paused the administration specifically allowed ongoing interest and capital redemptions to be made by borrowers. Where I disagree is with the underlying assumption that more than an odd borrower or two will currently be in a position to be able to redeem their overdue loans.
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blender
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Post by blender on May 9, 2018 15:21:56 GMT
You will know the position much better than I do, mrclondon. We have no influence, and what will be will be - we shall see. However, I would not expect borrowers to repay the principal without their security being released. There could be serious consequences.
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gareot
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Post by gareot on May 9, 2018 17:54:56 GMT
Did anyone emailed the “investorcillateral@bdo” email? I sent a very simple email to register my lender interest after the high court, but never heard anything back. Just wonder if I am the only one didn’t hear anything back from BDO’s designated investor email address? Thanks. I notified my interest via the BDO link in the faq 2nd May 2018 on the Collateral Companies-in Administration page yesterday evening & received a an automated reply this evening.
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tx
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Post by tx on May 9, 2018 19:12:57 GMT
Did anyone emailed the “investorcillateral@bdo” email? I sent a very simple email to register my lender interest after the high court, but never heard anything back. Just wonder if I am the only one didn’t hear anything back from BDO’s designated investor email address? Thanks. I notified my interest via the BDO link in the faq 2nd May 2018 on the Collateral Companies-in Administration page yesterday evening & received a an automated reply this evening. The only two links I could see was 1. link back to the BDO page and 2. The investor email. I’ll try to resend. See what happen. It is automatic reply anyway. Thanks.
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upland
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Post by upland on May 10, 2018 7:04:07 GMT
I kept quiet about this thinking that it might not go down too well & generally raise blood pressures but it seems to have been noticed. I have an ISA with Beauforts and an account with Collateral. They went into administration in the same week. Its interesting to assess what I have got for my £100M I have had a lot more competent information from the Beauforts administrators (PWC) about timescales and what will happen , emails , websites and a letter most of it very voluminous. I have just now filled in a client claim form on their website and their details of my assets were correct and its been rolled up with an FSCS claim for any shortfall. Hopefully the costs should not reduce what I finally get and the target for repatriation of my assets is September 2018. As long as I agree and go along with it then it was actually quite easy and the worst was all the website security setting up my claims account. They seem to be treating me as a client as separate from a creditor. It might all end in tears but I am happier with the situation than with Collateral. I would have hoped that our little fledgling industry would have done better. Perhaps thats unkind with the RR / FCA / BDO confusion and clearly BDO have come into the game late. Am I being unkind ?
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amanda373
Anyone downloaded the full transcript of the Court Session with the FCA. .?
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Post by amanda373 on May 10, 2018 7:47:35 GMT
When this became apparent I telephoned to complain about the likely appointment of BDO and the subsequent charges...having been here before with another liquidation of assets. I Also requested the appointment of a Committee of Inspection...which would,oversee the costs , so,wonder if this a have influenced the comment by the Court regarding costs.
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micky
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Post by micky on May 10, 2018 8:11:36 GMT
When this became apparent I telephoned to complain about the likely appointment of BDO and the subsequent charges...having been here before with another liquidation of assets. I Also requested the appointment of a Committee of Inspection...which would,oversee the costs , so,wonder if this a have influenced the comment by the Court regarding costs. How would your complaint have reached the judge though. I got the feeling that was simply part of his remit.
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mikeymike
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Post by mikeymike on May 10, 2018 8:59:21 GMT
I share everyone else's concerns that our funds may be at risk. Understatement of the year!!!
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