r00lish67
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Post by r00lish67 on Aug 3, 2019 20:52:32 GMT
Im heavily 'invested' in the art loans; Whitehaven (various tranches); Formby; Barnoldswick. Can someone briefly summarise what - if any - could be seen as FS deliberatly misselling these loans? Loans that were intentionally setup to fail would be any loan that had no reasonable chance of repayment from the start. TheBell, ChatterHouse et al. were all made to companies that could ill-afford more than two renewals; cumulatively the interest payments were ruinous but lenders were never told about the added contango risk. In no case was this more self-evident than in the Barnoldwackadoodle loans. FS advanced loans with interest payments of £400+/day to the same individual in Yorkshire who had nowhere near the high six-figure income to pay even a SINGLE six-month installment for all the loans he was given. It was simply impossible for him to repay these loans and the result was inevitable. When we speak of misselling, we should not forget that FS has a responsibly to reject loans that are impossible to repay, something they did not do in this case. And don't get me started on the second charge Barmydoodle loan, that was a whole different level of misselling from the minute the first word of the loan description was composed; I would call it a conspiracy if I thought FS had the intellectual capacity to perform such a feat. There's a significant supply. FS were warned on this forum and I believe directly about significant concerns with both the borrower and security for Len**uir (2419041369). They chose to disregard the problems, whilst adding a terse update including the (admittedly slightly amusing) update "The valuer has also confirmed there was a clerical error within the report stating that it was not suitable for lending purposes" ..and then launching it anyway. It made 1 renewal, which is now still active and was due to end in January. After 6 months radio silence at the of the loan came the sheepish "We are working to contact this borrower regarding the repayment of this loan. At the moment we are still seeking contact...." Lenders in that loan will inevitably (again) pay a heavy price from that toxic combination of an 'imaginative' borrower and useless security that FS were perfectly aware of in advance (because we told them).
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Post by dl292 on Aug 4, 2019 6:40:06 GMT
Thanks for all your comments. Very helpful.
So that I have this right:
1) Art loans: These were stated as being within FS's possession but were not and noone knows where they are. (Or do we know for a fact they were sold to someone else?). Also, we did not know that all the art loans were made to the same borrower exposing us to far greater risk.
2) Whitehaven: Property was demolished but nothing happened further than that; no oversight on tranches to access the situation; FS said the LTV would not exceed 70 percent.
What about Formby and Barnoldswick?
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adrian77
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Post by adrian77 on Aug 4, 2019 9:23:45 GMT
Seems about right to me - only thing I would add is that ref the demolition was not even done properly as footings etc have been left.
damn good question - I hate to think!
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micky
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Post by micky on Aug 4, 2019 9:41:18 GMT
Yep, and Knaresborough.
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agent69
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Post by agent69 on Aug 4, 2019 10:37:04 GMT
I'm in Barnoldswick for a small amount.
Does it hold the record for the most 'refinance is imminent' updates, without anything actually happening?
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iRobot
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Post by iRobot on Aug 4, 2019 11:16:15 GMT
But there is one guy who appears to love them.
3 separate reviews with 2 x 5* and 1 x 4* One can leave multiple reviews? Surely that goes against the entire purpose of such a review site? (I've never looked at it, but it seems obvious to me that it shouldn't work like that) One can, but TP only includes the most recent rating in the aggregate score.
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iRobot
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Post by iRobot on Aug 4, 2019 11:47:54 GMT
Why do you think have FS not already ended up in court on charges of fraud? Because the cost of legal action is disproportionately large compared to the amount the average investor has at stake? Even if you go to court and win, there is no guarantee that you will get all your costs back.
Which is why I am only slightly surprised that a consortium of FS' larger investors haven't sought redress through legal avenues - the risk outweighs the reward. Unfortunately, negligence is hard(er) to prove and a jury or business-biased organisation like the FOS could easily be influenced to believe that the whole omnishambles would never have happened, had it not been for such a dastardly and devious borrower taking advantage of well-meaning, innocent, respectable FCA-approved FS. I am more surprised that no one has ever pushed the FOS to a final determination. FC has had 6 and Lendy 3. (I am presuming that the FOS haven't simply awarded in the complainants favour in the first instance and that FS didn't bother to push for a determination and simply went with whatever remediation the FOS awarded.) Maybe that will change in a couple of months time.
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SteveT
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Post by SteveT on Aug 4, 2019 12:05:55 GMT
My Whitehaven T4/T5 mis-selling complaint was sat on the FOS’s desk for nearly 6 months before they decided that technically, because both parties to my part of the loan were Limited Companies (ie. both the borrower and my own company as lender), it wasn’t strictly Article 36H compliant and so was out of scope for the FOS to determine. However, r1200gs is now pursuing essentially the same complaint (he having lent in a personal capacity) and I believe it will be heading to the FOS shortly. If the FOS rule in his favour (as I’m confident they will), this will give me a strong basis for seeking equivalent redress through the courts. |
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Post by brightspark on Aug 4, 2019 14:57:17 GMT
Why do you think have FS not already ended up in court on charges of fraud? Because the cost of legal action is disproportionately large compared to the amount the average investor has at stake?
Even if you go to court and win, there is no guarantee that you will get all your costs back.
Surely fraud is a criminal offence rather than one requiring a civil action?
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adrian77
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Post by adrian77 on Aug 4, 2019 15:39:10 GMT
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petrichory
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Post by petrichory on Aug 4, 2019 18:14:04 GMT
arby - I was not referencing anyone in particular and I mostly skimmed over the last few pages. The impression I had was that some people were putting too much emphasis on the valuation without considering it within the context of a bridging loan, where brevity is key - a 50% LTV is useless if a development loan is dragged through receivership for 1000+ days. On the other hand, if FS advertises the same loan as being "pre-sold" and repeatedly re-confirms that the property is under a confirmed and verified sales contract in their advertisement, the same 50% LTV becomes eminently more appealing and all parts get snapped up in seconds. This was the case in TheBell loans. The framing of when the loan can be expected to complete - including the "updates" that get re-published in the "Asset" section upon renewal - are at least equally or more pertinent than the LTV percentage on its own. If you take out a payday loan because your paycheck didn't arrive in time, it may be approved once you show proof of employment. If you take out a payday loan and the lender sells this debt to a third party without checking if the borrower is actually employed, it would clearly be misselling or possibly fraud if a pattern of deliberate misselling can be established. brightspark - misselling is considerably easier to prove than fraud. The people who composed the Bwick, Whaven and Kborough loans nolonger work for FS and unless you can prove a pattern where fraud is either condoned or encouraged by management in the current iteration - a conspiracy, if you will, that straddles 3+ years - FS will be able to wash their hands of it. However, fraud was certain committed by some borrowers and especially in the Bwick case, the bankruptcy court should be compelled not to discharge the debt on this basis. There is simply no way this borrower took out these loans without overstating his income/assets in a fraudulent way and deliberately defaulting.
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reinvestor
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Post by reinvestor on Aug 4, 2019 18:56:09 GMT
My Whitehaven T4/T5 mis-selling complaint was sat on the FOS’s desk for nearly 6 months before they decided that technically, because both parties to my part of the loan were Limited Companies (ie. both the borrower and my own company as lender), it wasn’t strictly Article 36H compliant and so was out of scope for the FOS to determine. However, r1200gs is now pursuing essentially the same complaint (he having lent in a personal capacity) and I believe it will be heading to the FOS shortly. If the FOS rule in his favour (as I’m confident they will), this will give me a strong basis for seeking equivalent redress through the courts. It took them 6 months to realise that your loan was b2b and therefore outside of any consumer protective legislation?? Wow!! They must have some super sharp shooters working at the ombudsman service.
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Mucho P2P
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Post by Mucho P2P on Aug 4, 2019 19:38:09 GMT
It is not only that fraud is of low priority, it generally involves several police forces (as the fraud is usually located under the jurisdiction of one police force, and the perpetrator in another police force area and the necessity for police forces to liaise with other police forces = paperwork. So, unless the fraud is in the 100'Ks, they are likely to want to shift the blame/onus of work to someone else (make it a civil case) so that they do not have to get involved. You will need substantial proof from all sides for the police to make it a criminal case, rather than civil.
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Post by martin44 on Aug 4, 2019 19:54:18 GMT
Thanks for the reminder,,, Knaresborough..... i have only a very small amount tied up in this and had almost forgotten about it....    " src="//storage.proboards.com/forum/images/smiley/superangry.png">
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Godanubis
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Anubis is known as the god of death and is the oldest and most popular of ancient Egyptian deities.
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Post by Godanubis on Aug 4, 2019 21:39:52 GMT
Having spoken directly to the new person in charge this week.
Their priority is to sort out past errors and ensure they do not happen again as well as recovering as much as possible from those and current problem loans.
As there is not much else we can expect I am willing to wait see how successful they are with the recoveries and monitor new loans to access their ongoing performance.
Constantly moaning about past situations that were out with current management control is fruitless.
PAST PERFORMANCE IS NO INDICATOR OF FUTURE PERFORMANCE. A warning we see on every investment.
Let’s draw a line under the constant rehashing and criticism of past loans and allow the new leaders to put their best efforts in getting the best returns for everyone now and going forward.
Any legal issues arising will be addressed by the appropriate actions.
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