mikeb
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Post by mikeb on Oct 17, 2014 18:15:50 GMT
Now publicly acknowledged forum.fundingcircle.com/forum/talk-to-fellow-members/all-about-lending/9264-account-reconciliations"meaning that a small number of investors had more than their true total, and vice versa." What, a number of true totals had more than their small number of investors?  "These transactions are, in the main, caused by double sales of loan parts ... meaning that the seller could receive the proceeds twice. Although this is rare, our process is" ... broken? Selling a loan part twice (or buying it twice) and then having to manually pick through to remove the bits seems like something that needs stamping out, rather than continued manual fixing. "no impact on investors’ totals, nor information displayed on their summary pages." ... which remains slightly wobbly as usual. Please do not try to reconcile your own account, it won't work. If these changes have been made, and have no impact on totals, or information shown on summary pages, and don't appear on statements, then how does anyone know it happened? If it *does* appear on the statement and doesn't change totals, no wonder things don't balance. All very bizarre. |
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Post by GSV3MIaC on Oct 19, 2014 3:26:33 GMT
I've been trying to reconcile my account from transaction reports and loan part sale reports .. Not easy. For a start sales of loans which have since been repaid don't show up on the latter.
I have found most of the problem _ transactions for 'dwarf,' loan parts (where most of the bid was thrown out, but not all of it) did not get removed when the last part fell out .. So I have 'loan part offer for xyz loan, #12345' £12' where I never got a loan part. If I did get the part, no problem.
This can only explain small errors, since it is a rare occurrence, and can probably only happen once per (non-£200 multiple) loan ... I guess if you bid £1000 parts it'll happen to you more often, for larger sums.
MY worse case is £22 remains of a £40 (I guess) bid.
Why FC can't find it I dunno ... Took me 4 hours coding and testing, much of which was fretting over the car&ppy format of the available data.
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Post by batchoy on Oct 19, 2014 17:24:03 GMT
I have to say that I find this thread extremely worrying and points to a severe and fundamental flaw in FC's system design namely that is does not follow ACID design concepts and allows unreliable datasets to be produced. It should be fundamental to any system that is processing financial transactions that each transaction is either fully processed or rejected before the next transaction is initiated, this evidently does not occur within FC if it is possible to double sell loan parts as this is an indication that transactions not being fully completed before the next one is started.
From a personal point of view this type of fundamental flaw should warrant the immediate withdrawal of FCA permission interim or otherwise and trading should be halted until such time as these fundamental flaws are corrected.
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Post by GSV3MIaC on Oct 19, 2014 17:53:21 GMT
It has been mentioned before that the notion of 'atomic', ie indivisible, transactions does not seem to have made it into FC yet. They have some other problems too, like the way they regularly snopaque things out of the transaction reports (failed bids), which would get any accountant hung .. If you want to reverse something, you put in a counter transaction, not delete the first one. ( three weeks after the event, maybe). Of course recording every bid as a debit is a dumb design decision in the first place, (Imo) since probably as many as 90% of bids drop out .. Be better to debit them iff they made it to the auction close, or even to a loan.
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mikeb
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Post by mikeb on Oct 19, 2014 18:34:29 GMT
... severe and fundamental flaw in FC's system design namely that is does not follow ACID design concepts and allows unreliable datasets to be produced. It should be fundamental to any system that is processing financial transactions that each transaction is either fully processed or rejected before the next transaction is initiated, this evidently does not occur within FC if it is possible to double sell loan parts as this is an indication that transactions not being fully completed before the next one is started. ... and there should be a clear audit trail of what happened, not the sanitised version where we removed all the mistakes, and introduced new ones, altered a transaction here and there to make it balance. By "audit trail" -- I mean available to the customer, not some secret internal log that no-one is allowed to see. If it even exists. None of this "it got sold twice", "that transaction is reflected in your totals but not shown on your statement until the system gets a minute overnight", "it happened and then unhappened" nonsense. I believe the ACID principles, and fundamentals of how not to create such a mess in the first place, were covered in Database Fundamentals 101, and can probably be found in "Databases For Dummies". That's what you get for skipping chapters ... If they reconcile customers account daily, as claimed, how are errors persisting for > 24 hours? Why the sudden push to get everything to balance now (it's not like they were too fussed before when this was reported). Has someone perchance complained to the FCA, having got fed up of it being brushed under the carpet? The comment on corrections being applied 3 weeks later -- generally, it's safe to download a statement 3 weeks after month-end (2 weeks for max length auctions + 7 days dithering). However, there have been corrections (e.g. the wine merchant where £19.99 was refunded for £20 "recovery") that go back much further -- the £19.99 became £20 long after that statement was downloaded and archived.
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Post by batchoy on Oct 19, 2014 18:35:33 GMT
FC's snopake accounting technique has the potential to cause real issues if the transaction and its deletion crosses the Tax Year boundary.
A fellow trustee is currently undergoing a major investigation by HMRC of his tax return because NS&I notified HMRC of several large repayments of bonds with his name (amongst others) on them which then don't appear in his tax return. We have proven to HMRC that the payments went to the trust not to him personally but they are still going through all his numbers with a fine tooth comb so one wonders what would happen if FC decided invisibly correct errors that occurred before the end of one tax year in the next tax year leading to a change in the tax statement but after a tax statement had already been drawn off the system and the taxpayer (and their accountant) used the original tax statement in completing their tax return.
One of the conclusions I reached a while ago when I found that my figures rarely tallied was that the FC don't run a unified system but rather a raft of systems that operate independently completing different parts of each transaction with the result that when the systems move out of sync by minutes, hours or even days you end up with anomalies where totals are different depending on how and where you look at them us such as failed bids not being refunded soon enough to be able to rebid in an auction. Whilst you can on the face of it make things faster say processing bids it breaks the ACID concepts and leads to the anomalies that FC are secretively correcting.
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Post by yorkshireman on Oct 19, 2014 21:05:24 GMT
From a personal point of view this type of fundamental flaw should warrant the immediate withdrawal of FCA permission interim or otherwise and trading should be halted until such time as these fundamental flaws are corrected. I contacted the FCA back in July following similar incidents on 3 separate FC accounts held by family members and was amazed by the lack of knowledge of P2P within the organisation. No one seemed to have any interest or indeed idea how to proceed other than suggesting (I emphasise suggesting rather than advising) making a complaint to the Financial Ombudsman at which point I gave up in exasperation, fortunately the discrepancies were corrected by FC although it is extremely worrying to hear about a recurrence of the problem.
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min
Member of DD Central
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Post by min on Oct 21, 2014 21:48:24 GMT
Earlier this evening I noticed that I had £103.xx in available funds and thought I'd take out £100 but decided to leave till later. Just gone back in and now only £99.xx is available. At same time amount lent gone up by about same difference. What the f... is going on? Earlier today my FC total went down by about 30p with no explanation.
Have complained before about random adjustments to account but without screenshot they can't or won't do anything.
Will the last lender to leave FC please turn out the lights.
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mikeb
Posts: 1,072
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Post by mikeb on Oct 22, 2014 8:39:08 GMT
Warning: The lights are apparently being retrofitted with FC style dimmers at AC.
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hendragon
Member of DD Central
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Post by hendragon on Oct 22, 2014 9:15:39 GMT
Re-examining the contents of this thread there are some worrying aspects for the p2p sector as a whole.
1 What seems to be a lack of accountability and transparency of a large lending platform.
2 The anecdotal evidence here that the FCA may be unwilling/unable to deal with a problem of this nature.
3 Given my experience of this was from almost 2 years ago are FC unwilling or unable to correct or improve the situation, without any consequences?
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Post by GSV3MIaC on Oct 25, 2014 15:01:50 GMT
Some more (late) thoughts .. thinking about this 'partial bids are not released properly', I guess it may be a timing/race hazard. presumably when your £100 bid is cut down to £80 by an underbidder, the next knockout action is likely to be milli or micro seconds later .. if your transaction report is in the process of having "loan offer on xyz, £100' snopaked out and "loan offer for on XYZ £80" put back in, I can see why the 'remove that £80 transaction' action might screw up, just on timing grounds.
A modest suggestion then .. at the end of the auction, when/if the loan gets accepted:
All 'loan offer on XYZ £zz" entries from ALL accounts are erased, and
"Successful Bid on Loan XYZ, loan Part # xxxxxxxxx £zz"
gets put back in the transaction reports of all those people who got a loan part. Stuck bids - gone. Being charged for what you didn't get .. gone. Not being charged for what you did get (yep, I had one of those too) also gone. Traceability of transaction reports to loan parts improved by about 100000%.
Job done.
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jimbo
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Post by jimbo on Oct 26, 2014 1:04:03 GMT
I notice from the comments that many people seem to have the expectation that the FCA are a highly effective bunch of eagle-eyed eager beavers. When it comes to issuing reams of rules and regulations this is certainly true in my opinion. However, when it comes to investigating allegations of wrongdoing - particularly when it comes to their role of regulating our financial markets - they seem less effective; particularly when it comes to transparency. For example, if one sends in an email alleging market abuse, you'll get a response along the lines of "Thankyou for this. We may take action to investigate but will not tell you if we do or what the action was if we do take it".
There's a saga I'm currently following with a company listed on the Alternative Investment Market via a website called ShareProphets. I do not want to post any links here because they will invariably contain the name of the listed company involved and this is sensitive stuff that I do not want to spill over into this forum. However, anybody who's interested only has to go to the ShareProphets website to figure it out. The nature of the allegations are serious (fraud etc) and there are enough red flags to make me think the FCA should be taking the allegations seriously and investigating. However, due to lack of transparency, there is currently nothing out in the public domain to suggest that they are. The company in question certainly hasn't yet had its shares suspended, I know that much..
I therefore have no faith in the FCA to adequately investigate any allegations of wrongdoing in ANY sector they regulate until the failure has already hit the public domain (bank product mis-selling anybody) and they take the retrospective action to clamp down on whatever it is they should have clamped down on before it became a problem.
All this is just my opinion at the end of the day. Maybe the FCA are doing a sterling job when it comes to ticking off and punishing wrongdoers, but due to the lack of transparency, you will never know.
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