beagle
Investor in ratesetter, funding circle, lendy (lesson learnt) and AC
Posts: 670
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Post by beagle on Dec 29, 2020 16:32:29 GMT
it is not a sham. if it is why did you place your money there? There are just a few players with inferior resource. Those who have resource need HUGE loan books to sustain economic shocks. Perhaps its not always a sham but the model in general has failed. Not just a few players - many platforms have failed and some/many revealing criminal activity in their wake. The problem may be just policing - i.e. the FCA should step up. But I think it may be more than that. Under the current rules platforms don't have to have any skin in the game - indeed most don't. There is a real conflict right there waiting to explode and it is doing. Valuations are also highly problematic but again part of that maybe that they are requested by a platform that doesn't care in the medium term whether the valuation is wrong but does care to win the business of the borrower. Don't invest in p2p is my advice. all new industries have criminal activity. That said even old set ups - our banks - do the same. Crime and money are hand in hand yet banks do the same and crash our economies too. The FCA is an administrative body for them to step up requires a disaster. If you want all risk - pick a stock and stand by it. even then companies play bad. there is a risk with all. but indeed p2p is a tad too pretty to be honest. e.g. 8% is nonsense - as this means the lend rate must be circa 15% to factor fees and costs meaning you have crappy borrowers. you have better security in Greek state debt (at least the EU will pay you back - somehow).
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benaj
Member of DD Central
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Post by benaj on Jan 5, 2021 13:00:29 GMT
Soon will be 2 years anniversary. I start to wonder if we are getting out of the COVID first or getting the end of this mess first.
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Post by df on Jan 5, 2021 14:05:25 GMT
Iirc UB were going to repay the capital to investors and carry on with this case on their own as oppose to representing investors, but FCA didn’t allow that. I wouldn’t take a liberty to make any timeline predictions, but I think one day we’ll get all or some of the capital back.
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IFISAcava
Member of DD Central
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Post by IFISAcava on Jan 5, 2021 15:19:41 GMT
Iirc UB were going to repay the capital to investors and carry on with this case on their own as oppose to representing investors, but FCA didn’t allow that. I wouldn’t take a liberty to make any timeline predictions, but I think one day we’ll get all or some of the capital back. These loans are under the old terms so should I think be covered by the provision trusts and therefore all capital should ultimately be repaid, assuming UB remains in business.
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ozboy
Member of DD Central
Mine's a Large One! (Snigger, snigger .......)
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Post by ozboy on Jan 5, 2021 15:45:13 GMT
"but I think one day we’ll get all or some of the capital back."Unfortunately, 1p in the Pound qualifies as " ...some of the capital back."
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keystone
Member of DD Central
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Post by keystone on Jan 5, 2021 19:22:37 GMT
Iirc UB were going to repay the capital to investors and carry on with this case on their own as oppose to representing investors, but FCA didn’t allow that. I wouldn’t take a liberty to make any timeline predictions, but I think one day we’ll get all or some of the capital back. Well no surprise there then. It would go against the whole ethos of the FCA to allow investors to get their own money back rather then being screwed for everything they had.
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agent69
Member of DD Central
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Post by agent69 on Jan 5, 2021 19:59:00 GMT
Iirc UB were going to repay the capital to investors and carry on with this case on their own as oppose to representing investors, but FCA didn’t allow that. I wouldn’t take a liberty to make any timeline predictions, but I think one day we’ll get all or some of the capital back. Well no surprise there then. It would go against the whole ethos of the FCA to allow investors to get their own money back rather then being screwed for everything they had. I thought that the ethos of P2P lending was that it is the lender that takes the investment risk, not the platform?
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Greenwood2
Member of DD Central
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Post by Greenwood2 on Jan 5, 2021 20:12:52 GMT
Well no surprise there then. It would go against the whole ethos of the FCA to allow investors to get their own money back rather then being screwed for everything they had. I thought that the ethos of P2P lending was that it is the lender that takes the investment risk, not the platform? But we thought our risk was limited to what we lent. The idea that we could be sued individually (for larger amounts) because of clauses in the borrowers contracts that we were not even aware of was not part of the deal.
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james100
Member of DD Central
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Post by james100 on Jan 5, 2021 21:11:06 GMT
I thought that the ethos of P2P lending was that it is the lender that takes the investment risk, not the platform? But we thought our risk was limited to what we lent. The idea that we could be sued individually (for larger amounts) because of clauses in the borrowers contracts that we were not even aware of was not part of the deal. I just can't see the borrower getting away with screwing any individual over this. His track record as a vexatious litigant has already been noted and the legal intent behind all contracts was crystal clear. This wasn't his first UB rodeo. He knew full well what he was entering in to. Bullying, irresponsible time waster. This case really irritates me. The sheer malicious entitlement of it.
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Post by df on Jan 5, 2021 21:36:11 GMT
Iirc UB were going to repay the capital to investors and carry on with this case on their own as oppose to representing investors, but FCA didn’t allow that. I wouldn’t take a liberty to make any timeline predictions, but I think one day we’ll get all or some of the capital back. These loans are under the old terms so should I think be covered by the provision trusts and therefore all capital should ultimately be repaid, assuming UB remains in business. In theory, they should do when the case is closed. We'll see what happens, but apart from this borrower (I believe inspired by the 'London loan' borrower's attempt) I've never experienced any problems with lending on UB.
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agent69
Member of DD Central
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Post by agent69 on Jan 6, 2021 9:39:57 GMT
I thought that the ethos of P2P lending was that it is the lender that takes the investment risk, not the platform? But we thought our risk was limited to what we lent. The idea that we could be sued individually (for larger amounts) because of clauses in the borrowers contracts that we were not even aware of was not part of the deal. The problem is that lots of people (myself included) have entered into p2p contracts without ever reading what they were signing up to.
The fact that you thought risks were limited or were not aware of what you were signing up to is a very poor starting point for a legal challenge
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Greenwood2
Member of DD Central
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Post by Greenwood2 on Jan 6, 2021 12:55:27 GMT
But we thought our risk was limited to what we lent. The idea that we could be sued individually (for larger amounts) because of clauses in the borrowers contracts that we were not even aware of was not part of the deal. The problem is that lots of people (myself included) have entered into p2p contracts without ever reading what they were signing up to.
The fact that you thought risks were limited or were not aware of what you were signing up to is a very poor starting point for a legal challenge
Nothing in the T&Cs we signed up to suggested even a possibility of 'unlimited risk' however carefully you read them.
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agent69
Member of DD Central
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Post by agent69 on Jan 6, 2021 16:02:37 GMT
The problem is that lots of people (myself included) have entered into p2p contracts without ever reading what they were signing up to.
The fact that you thought risks were limited or were not aware of what you were signing up to is a very poor starting point for a legal challenge
Nothing in the T&Cs we signed up to suggested even a possibility of 'unlimited risk' however carefully you read them. The problem with contracts is that you are not just bound by the terms and conditions which are expressely stated in the contract, you are also bound by a host of other terms courtesy of British law. As an example:
- if you are in breach of contract the agrieved party has an obligation to take reasonable steps to mitigate their loss, and
- if you are in breach of contract the agrieved party is entitled to recover from you any costs that they can show have arisen as a result of the breach (assuming that the written agreement doesn't make provision for this situation)
Given these things, if there has been a breach which has caused the borrower to incurr costs, then who is he going to recover those costs from? He can't go after the platform as his contract is with the lenders.
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Mousey
Member of DD Central
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Post by Mousey on Jan 6, 2021 18:11:31 GMT
He can't go after the platform as his contract is with the lenders. With respect to this case I understand from the judgement dated March 2020 that there were "claims identified against [Unbolted] as agent for the lenders, in respect of certain allegations, and claims against [Unbolted] in its own right in relation to claims for the return of securities and damages for alleged breaches of FCA regulations" so he certainly can go after the platform in some respects. As a bit of a research project I had a dig about for any case law that might suggest how the courts approach purported breaches of FSMA & CCA as I understand from the judgement dated Sept 2019 that the borrower: "sought include damages for misleading actions contrary to the Consumer Protection from Unfair Trading Regulations 2008; damages pursuant to section 138(d) of the Financial Services and Markets Act 2000, and relief under section 140(b) of the Consumer Credit Act 1974" For those who are really interested (and indeed strictly for those who are able to appreciate that nuances can swing a case wildly in the wind and therefore no reliance should be placed on this at all) I found the following case " Helden v Strathmore Ltd [2011] EWCA Civ 542". I'm not going to do a line-by-line commentary but the conclusion of Lord Neuberger at para 54 sums up the piece: "Accordingly, I would uphold the Judge's decision that (i) Strathmore contravened FSMA by entering into the 2006 Charge, and (ii) it was nonetheless just and equitable to permit Strathmore to enforce the 2006 Charge. "Some more detail is at Para 22 (quoted out-of-context but the point still stands): "although the 2006 Charge was defective in its provisions, because it failed to identify the loan which was thereby secured and the rate of interest it was to carry, as it sought to do so by reference to an offer letter which did not exist, it was clear that the parties had agreed what the loan was and the interest which was to be payable in respect of it."
And at Para 24: "The Judge held that Mr H was bound by the oral agreement as to the size and identity of the loan secured by the 2006 Charge and the rate of interest payable thereon, as a result of estoppel by convention"
[Incidentally Assetz faced a similar conclusion by a Judge at County Court level on one of their loans - that despite it being a regulated mortgage the terms were still enforceable]
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Greenwood2
Member of DD Central
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Post by Greenwood2 on Jan 7, 2021 8:38:15 GMT
Nothing in the T&Cs we signed up to suggested even a possibility of 'unlimited risk' however carefully you read them. The problem with contracts is that you are not just bound by the terms and conditions which are expressely stated in the contract, you are also bound by a host of other terms courtesy of British law. As an example:
- if you are in breach of contract the agrieved party has an obligation to take reasonable steps to mitigate their loss, and
- if you are in breach of contract the agrieved party is entitled to recover from you any costs that they can show have arisen as a result of the breach (assuming that the written agreement doesn't make provision for this situation)
Given these things, if there has been a breach which has caused the borrower to incurr costs, then who is he going to recover those costs from? He can't go after the platform as his contract is with the lenders.
If we are going to throw the buffer of the platform between borrower and lenders out of the window, then Lenders can also individually pursue borrowers for their money back + interest + damages, in this case that could be 600+ small claims cases!
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