ilmoro
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'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Apr 26, 2020 19:20:46 GMT
Read the FAQ on the Assetz website. Those smart enough to understand it will see the changes spelt out to them. The platform terms & conditions have not been changed AIUI but the account operating parameters as defined by the key account info have been changed as permitted by the t&Cs. The question is whether the KAI in anyway constitute terms whose variation is a contractual change to which lenders need to consent. Is it anywhere stated/was stated that withdrawals will operate on a specific basis?
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dave4
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Cynical is a hobby not a lifestyle
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Post by dave4 on Apr 26, 2020 19:24:28 GMT
I'm looking at commissioning a legal opinion on the legality of AC's change of policy. There are 2 elements to this: 1) that under the current revised procedures for making withdrawals from the Access accounts and the Property Secured Account, larger Lenders are now disproportionately disadvantaged. As joint Lenders we are all meant to have the same exposure pro-rata to our investments - the new queueing system stops that exposure being shared pro-rata. 2) with larger Lenders only being able to take out tiny percentages of the money that they put in, a yearly management charge of 0.9% being charged on the remainder is unfair. In order for a solicitor to start looking at this, they of course need to see some paperwork. Does anyone have any thoughts on the best source for AC's terms prior to the recent change and AC's terms now? Is there anywhere with a concise summary of what has happened - ie the change in the queuing system? Has anyone already collated this info for their own legal advisors? Thanks in anticipation...... To what end,achieve what ? (Serious Question)
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registerme
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Post by registerme on Apr 26, 2020 19:27:06 GMT
If you look at Terms and Conditions section 20. "Altered Circumstances and Changes to The Terms" I suspect AC's "out" is the use of the phrase "will endeavour to....".
(I'm not going to get into the whole rights and wrongs of what's going on, in these circumstances whatever AC did would end up upsetting one set of stakeholders or another to varying degree. As it happens I think they've managed to upset everybody - some accept the rationale, the decisions and the execution, some don't).
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Post by gobuchul on Apr 26, 2020 19:28:03 GMT
By the way what you are looking for is a breach of contract. Judges are not that worried about things being unfair. The management charge is allowed under the terms so there is no breach of contract. Nope, it's called Material Misrepresentation and it's a type of fraud.
I'd also correct you on unfairness which is a concern to the FCA who regulate and Authorise Assetz. Material Misrepresentation is not a UK legal term, and nope, the FCA don't care about unfairness because it's too subjective. They care about compliance.
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Mousey
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Post by Mousey on Apr 26, 2020 19:54:30 GMT
Nope, it's called Material Misrepresentation and it's a type of fraud.
I'd also correct you on unfairness which is a concern to the FCA who regulate and Authorise Assetz. Material Misrepresentation is not a UK legal term, and nope, the FCA don't care about unfairness because it's too subjective. They care about compliance. My apologies, the Misrepresentation I was looking for was Actionable Misrepresentation which concerns a material fact. You will see my previous comments about AM wrt fundingsecure .
And I assume you include compliance with Principle 6 "A firm must pay due regard to the interests of its customers and treat them fairly."
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alender
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Post by alender on Apr 26, 2020 21:09:36 GMT
From a legal website
The FCA says that financial services firms should consider these factors when drafting and reviewing variation terms in their consumer contracts. These factors have a common theme of 'transparency', and include: whether the firm has included the variation term "to achieve a legitimate objective"; if the reasons the firm gives for amending the contract are "no wider than is reasonably necessary to achieve a legitimate objective"; whether the reasons are objective and clearly expressed, and whether it is possible to verify that the reasons have arisen; whether the consumer understands the consequences of a future variation at the time the contract is concluded; what notice of any variation will be given;
whether the customer will have "freedom to exit", contractually and practically; and whether the term "strikes a fair balance between the legitimate interests of the firm and the legitimate interests of the consumer". In this case AC changed the T&Cs and the customer has no freedom to exit, looks like there is a good case.
Also I believe T&Cs make up a contractual agreement between the lenders and the platform I am not sure of the legality that one party can have an enforceable clause that states they can change the T&Cs without the other party permission. When RS changed the T&Cs it gave its lenders the right to withdraw all of there funds from the platform and by not using this option the lenders accepted the new T&Cs.
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ilmoro
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'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Apr 26, 2020 21:13:38 GMT
From a legal website
The FCA says that financial services firms should consider these factors when drafting and reviewing variation terms in their consumer contracts. These factors have a common theme of 'transparency', and include: whether the firm has included the variation term "to achieve a legitimate objective"; if the reasons the firm gives for amending the contract are "no wider than is reasonably necessary to achieve a legitimate objective"; whether the reasons are objective and clearly expressed, and whether it is possible to verify that the reasons have arisen; whether the consumer understands the consequences of a future variation at the time the contract is concluded; what notice of any variation will be given;
whether the customer will have "freedom to exit", contractually and practically; and whether the term "strikes a fair balance between the legitimate interests of the firm and the legitimate interests of the consumer". In this case AC changed the T&Cs and the customer has no freedom to exit, looks like there is a good case.
Also I believe T&Cs make up a contractual agreement between the lenders and the platform I am not sure of the legality that one party can have an enforceable clause that states they can change the T&Cs without the other party permission. When RS changed the T&Cs it gave its lenders the right to withdraw all of there funds from the platform and by not using this option the lenders accepted the new T&Cs.
Which clause in the T&cs has been changed?
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Mousey
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Post by Mousey on Apr 26, 2020 21:48:45 GMT
Which clause in the T&cs has been changed? Look at the FAQ on the Assetz website. The details are in the paragraph beginning "During this period of financial turmoil, we have temporarily altered the way in which the queue is processed. "
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Apr 26, 2020 22:38:21 GMT
Which clause in the T&cs has been changed? Look at the FAQ on the Assetz website. The details are in the paragraph beginning "During this period of financial turmoil, we have temporarily altered the way in which the queue is processed. " That's not a change in the t&cs that's a change in the operation of the account as permitted by the t&cs. Furthermore, is there any statement that says how the queue should be processed? The change is in what has been practiced previously but I am unaware of anything that specifically defines a FIFO system.
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ian
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Post by ian on Apr 27, 2020 8:27:33 GMT
As investors I’m sure we all accept the world has changed and recognise the platform has to adapt in order to allow an orderly withdrawal of funds. We understand we can’t have immediate access to our cash. The decision however to remove the instruction "Withdraw All" from the Access Accounts without investors authority is both unfair, discriminatory and most likely illegal. Ultimately this forces investors to invest redeemed capital & interest into increasingly risky loans which may default, against our wishes.
Initially I would hope investors might consider writing to AC & give the explicit instruction that any capital repayment and/or interest payment made to the access account on loans that they are a participant in should not be reinvested nor do AC have permission to do so. Additionally I would hope they will support and be prepared to contribute to fund legal action, if AC refuse, our requests.
The arrogance & contempt Stuart Law appears to have for his investors is beyond belief. The decision clearly has been taken to ensure the platform continues to operate irrespective of the cost to investors.
In short it is my belief AC are no longer acting in the best interests of investors. We should explicitly disagree to be bounded by the amended terms. Expectation that we would be under an obligation to do so is unfair & is also actionable in my opinion.
I personally would be happy to contribute towards legal fighting fund if necessary.
Given AC blatantly refuse to engage with customers concerns. We should also collectively contact the FCA, and financial media in the hope that the exposure of such unfair discriminatory practice in the media will bring about an immediate change in their conduct.
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ceejay
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Post by ceejay on Apr 27, 2020 8:40:48 GMT
As investors I’m sure we all accept the world has changed and recognise the platform has to adapt in order to allow an orderly withdrawal of funds. We understand we can’t have immediate access to our cash. The decision however to remove the instruction "Withdraw All" from the Access Accounts without investors authority is both unfair, discriminatory and most likely illegal. Ultimately this forces investors to invest redeemed capital & interest into increasingly risky loans which may default, against our wishes. ... This blathering from impatient lenders who seem to have not the faintest idea what they are doing, talking about, or invested in is getting extremely tedious. There has been no decision to remove the "Withdraw All" instruction - you can request a withdrawal any time you like. It's just that, right now, you have a very long wait because there is no liquidity. There aren't enough (well, more likely any) investors wanting to buy from you. The only way you're going to get (most of) your money back is to allow the loans to run out. That's the nature of P2P lending, always has been. BTW, there are plenty of other platforms where exiting is impossible at the moment. GS, for example, is in total lockdown with not even interest being allowed out. And have you tried selling anything on FC recently?
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Mousey
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Post by Mousey on Apr 27, 2020 8:41:42 GMT
Look at the FAQ on the Assetz website. The details are in the paragraph beginning "During this period of financial turmoil, we have temporarily altered the way in which the queue is processed. " 1) That's not a change in the t&cs that's a change in the operation of the account as permitted by the t&cs. 2) Furthermore, is there any statement that says how the queue should be processed? The change is in what has been practiced previously but I am unaware of anything that specifically defines a FIFO system. 1) The Terms and Conditions, Key Account Info along with other statements and representations on the Assetz website are just a few of the ingredients that collectively form the contractual terms. Ie the offer and the acceptance.
2) Yes, that's the use of the word queue.
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Mousey
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Post by Mousey on Apr 27, 2020 8:43:05 GMT
As investors I’m sure we all accept the world has changed and recognise the platform has to adapt in order to allow an orderly withdrawal of funds. We understand we can’t have immediate access to our cash. The decision however to remove the instruction "Withdraw All" from the Access Accounts without investors authority is both unfair, discriminatory and most likely illegal. Ultimately this forces investors to invest redeemed capital & interest into increasingly risky loans which may default, against our wishes. ... It's just that, right now, you have a very long wait because there is no liquidity.
There is a large amount (circa 5%) of liquid cash in the accounts.
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ian
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Post by ian on Apr 27, 2020 8:54:26 GMT
As investors I’m sure we all accept the world has changed and recognise the platform has to adapt in order to allow an orderly withdrawal of funds. We understand we can’t have immediate access to our cash. The decision however to remove the instruction "Withdraw All" from the Access Accounts without investors authority is both unfair, discriminatory and most likely illegal. Ultimately this forces investors to invest redeemed capital & interest into increasingly risky loans which may default, against our wishes. ... This blathering from impatient lenders who seem to have not the faintest idea what they are doing, talking about, or invested in is getting extremely tedious. There has been no decision to remove the "Withdraw All" instruction - you can request a withdrawal any time you like. It's just that, right now, you have a very long wait because there is no liquidity. There aren't enough (well, more likely any) investors wanting to buy from you. The only way you're going to get (most of) your money back is to allow the loans to run out. That's the nature of P2P lending, always has been. BTW, there are plenty of other platforms where exiting is impossible at the moment. GS, for example, is in total lockdown with not even interest being allowed out. And have you tried selling anything on FC recently? That is where you are wrong there is some liquidity - however interest & capital payments are being channelled into additional loans. Nobody expects access to all their cash ... just that which has been repaid by borrowers.
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cb25
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Post by cb25 on Apr 27, 2020 9:22:05 GMT
This blathering from impatient lenders who seem to have not the faintest idea what they are doing, talking about, or invested in is getting extremely tedious. There has been no decision to remove the "Withdraw All" instruction - you can request a withdrawal any time you like. It's just that, right now, you have a very long wait because there is no liquidity. There aren't enough (well, more likely any) investors wanting to buy from you. The only way you're going to get (most of) your money back is to allow the loans to run out. That's the nature of P2P lending, always has been. BTW, there are plenty of other platforms where exiting is impossible at the moment. GS, for example, is in total lockdown with not even interest being allowed out. And have you tried selling anything on FC recently? That is where you are wrong there is some liquidity - however interest & capital payments are being channelled into additional loans. Nobody expects access to all their cash ... just that which has been repaid by borrowers. Which additional loans? If you mean additional loan tranches on existing loans, I'm in favour of that because the alternative is that those loans go belly up and we all lose loads of money.
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