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 Aug 4, 2023 16:41:45 GMT
Hey - thanks for all the responses and thoughts! Personally I find it useful to hear from other people in a similar position - I'm not sure what advice you think I'm taking from anyone markg2020? I was under the impression there isn't exactly anything we can do haha... other than wait! I also said that I understood the risks... I'm well aware it could be worse and could get nothing back - I just assumed 8 months down the line from their initial announcement that repayment might be a little quicker, I guess, given their stated intention to do so. It's actually more worrying to me that it's ahead of schedule if this is the rate we can expect. Personally, I do see lost investment opportunity as a loss as it seems like we are looking at years for repayment and my primary concern is whether we will actually see all that capital repaid or not. (In which case, definite loss!) I appreciate that you may be trying to come from a good place but it does come across as quite patronising. You tell me not to take any advice from anyone on here but then end your post with 'a word of advice'... I'm glad you have full faith in AC and their process though - at least someone does! I'll try to take some of that positivity! Thanks for your input. Hi Help No disrespect meant to you. I am in a similar position to you and I believe that AC are doing their best in this interest rate environment. Other companies are going to the wall due to the current financial environment. Yet a lack of understanding of this by the no win no fee cheer leaders could find every investor's losses magnify Best regards to you Are they though? and that's the big question. This is a problem of ACs own making ... a fundamentally flawed product that was unable to adapt to rapid interest rate fluctuations, compounded by AC's failure to spot the direction of travel (not alone in that Mr Bailey) so filled the AA with low rate, long term loans to create capacity, and even refi'd some in term higher rate loans onto lower rates. In contrast other platforms were able to raise rates, in some cases pivoting quickly to more variable rates for borrowers or inflation linked. I don't disagree that administration is not a good end point & should be avoided but I think it's disingenuous to suggest investors agreed to what we have now. The level of fee is certainly not a risk that was clear, especially given a wind down plan that made no suggestion of its necessity. It's a particularly ugly swan for lenders even at a superficial look, but look beneath the surface ...
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Post by garreh on Aug 4, 2023 16:56:13 GMT
...... All investments have risks. Did you read the terms and conditions of your investment and sign a declaration that you fully understood the risks? Many on this forum seem that they did not. ..... I appreciate the thrust of your argument, but what if the platform unilaterally changes those terms & conditions and/or introduces additional risks? Would you think it unreasonable for investors to feel aggrieved? Agreed. These AC defenders are condescending to everyone, suggesting lack of understanding of risks and should unequivocally accept all of ACs new terms despite the new element of risk associated with them. It's absurd. The investment AC is now offering is unrecognisable from what investors originally signed up for. They have moved all risks onto the lenders, with minimal to zero risk to themselves. I was unfortunate to be a part of Growth Street and RateSetter wind-down as well. And let me say this - their process was far more transparent, clearly defined in their terms and they stuck to them like glue. Investors got back 100%, and within a year. They didn't change things as they went along to suit their own needs, with increasing rates. AC have changed the lender structure 3 times in 6 months. And let's not forget the controversial fee structure implemented during Covid. What's the point in terms and conditions when you can change them every other month without anybody being able to voice their concerns? How on earth do lenders appropriately assess risk in that kind of environment? AC think they can get away with this, but eventually I think this catches up with them.
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alender
Member of DD Central
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Post by alender on Aug 5, 2023 10:58:26 GMT
Hey - thanks for all the responses and thoughts! Personally I find it useful to hear from other people in a similar position - I'm not sure what advice you think I'm taking from anyone markg2020 ? I was under the impression there isn't exactly anything we can do haha... other than wait! I also said that I understood the risks... I'm well aware it could be worse and could get nothing back - I just assumed 8 months down the line from their initial announcement that repayment might be a little quicker, I guess, given their stated intention to do so. It's actually more worrying to me that it's ahead of schedule if this is the rate we can expect. Personally, I do see lost investment opportunity as a loss as it seems like we are looking at years for repayment and my primary concern is whether we will actually see all that capital repaid or not. (In which case, definite loss!) I appreciate that you may be trying to come from a good place but it does come across as quite patronising. You tell me not to take any advice from anyone on here but then end your post with 'a word of advice'... I'm glad you have full faith in AC and their process though - at least someone does! I'll try to take some of that positivity! Thanks for your input. Hi Help No disrespect meant to you. I am in a similar position to you and I believe that AC are doing their best in this interest rate environment. Other companies are going to the wall due to the current financial environment. Yet a lack of understanding of this by the no win no fee cheer leaders could find every investor's losses magnify Best regards to you The problem is not with people going to no win no fee lawyers but AC leaving investors with no other option, AC thinks it can do as it likes and there is nothing lenders can do about it. You can go the the FOS wait years by which time AC will have milked all they can from investors and then will probably put it into administration. I agree there are no good options and it is annoying that AC may be brought down by the actions of other people which you disagree but it is not an unreasonable choice to go the no win no fee route, at this point nobody knows the best course and what AC will do next to get more of your hard earned cash.
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alender
Member of DD Central
Posts: 981
Likes: 683
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Post by alender on Aug 5, 2023 11:04:57 GMT
I appreciate the thrust of your argument, but what if the platform unilaterally changes those terms & conditions and/or introduces additional risks? Would you think it unreasonable for investors to feel aggrieved? Agreed. These AC defenders are condescending to everyone, suggesting lack of understanding of risks and should unequivocally accept all of ACs new terms despite the new element of risk associated with them. It's absurd. The investment AC is now offering is unrecognisable from what investors originally signed up for. They have moved all risks onto the lenders, with minimal to zero risk to themselves. I was unfortunate to be a part of Growth Street and RateSetter wind-down as well. And let me say this - their process was far more transparent, clearly defined in their terms and they stuck to them like glue. Investors got back 100%, and within a year. They didn't change things as they went along to suit their own needs, with increasing rates. AC have changed the lender structure 3 times in 6 months. And let's not forget the controversial fee structure implemented during Covid. What's the point in terms and conditions when you can change them every other month without anybody being able to voice their concerns? How on earth do lenders appropriately assess risk in that kind of environment? AC think they can get away with this, but eventually I think this catches up with them. I was in Growth Street and believe I was fortunate as they stuck to the rules and returned all my funds as quick as possible. I did lose interest after they locked down but at that time interest rates were low and given the higher rate and bonuses was better off than if I had put it into AC. I got out of AC as quick as I could without selling on the SM mostly because they kept changing the rules and could not be trusted.
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ashtondav
Member of DD Central
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Post by ashtondav on Aug 6, 2023 14:28:43 GMT
part of Growth Street and RateSetter wind-down as well. And let me say this - their process was far more transparent, clearly defined in their terms and they stuck to them like glue. Investors got back 100%,
Lending works, zopa - ye gods even FC behaved in a reasonably decent wind down manner. The bunch at the top of this disreputable firm take some beating in the downright scandalous awards. I can still recall one unpleasant creature “welcoming those who ZOPA have deserted.” I’d rather have a red hot poker than a “welcome” from him.
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rscal
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Post by rscal on Aug 6, 2023 15:52:32 GMT
part of Growth Street and RateSetter wind-down as well. And let me say this - their process was far more transparent, clearly defined in their terms and they stuck to them like glue. Investors got back 100%,Lending works, zopa - ye gods even FC behaved in a reasonably decent wind down manner. The bunch at the top of this disreputable firm take some beating in the downright scandalous awards. I can still recall one unpleasant creature “welcoming those who ZOPA have deserted.” I’d rather have a red hot poker than a “welcome” from him. You sound a bit like that Solar expert from live chat with Stuart last-last April: And (oh dear) did that ever set the tone for an ill natured reply, the gist of which was: "I'm too bizy smelling out risk everywhere, looking after YOUR savings to address this troll. Here, let me skule you in 'risk' and bloviate some more smoke"
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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
Posts: 11,315
Likes: 11,523
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Post by ilmoro on Aug 7, 2023 16:30:09 GMT
Rough numbers, due to a certain level of estimating AA holdings, and no guarantee I havent made errors As of June 30 Capital outstanding £114.8m Free Cash £10.2m Outstanding funding commitments £4.3m Repayment of #1550 knocked a big chunk off potential funding requirements. Obviously the £2m distribution the quarterly update suggested never materialised but good news is should be a much bigger repayment next week given there is £6m+ free cash )or will be once #1238 funds are added to pot) Loans 253 Default 33 (NB includes 6 where holding is nominal) £15m No payment interest June - 29 (£25m incl default but not those default making interest payments ) Repaid 6 Capital repaid £3.9m v scheduled £10.7m (usual can kicking suspects) Drawdowns £646k v scheduled £1.1m Cash flow +£3.2m v £11.6m Interest received c475k representing approx 114% of sum needed to pay 4% before the lender fee. The science guesswork bit ie totally speculative June fees £94m @6.25% - £488k Catchup fees £5m @2.9% - £12k Total £500k Shortfall £25k As of July 31 Capital outstanding £114.2m Free Cash £7.3m Outstanding funding commitments £4.1m Loans 249 Default 41 (includes 7 with nominal amounts) £15m No payment interest July - 48 (£15m incl default but not those default making interest payments ) Repaid 4 (£740K) Capital repaid £1.25m v scheduled £11m (usual can kicking suspects) Drawdowns £350k v scheduled £630K Cash flow +£1m v £11.6m Interest received c459k representing approx 114% of sum needed to pay 4% before the lender fee.
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Post by bob2010 on Aug 7, 2023 17:48:35 GMT
Rough numbers, due to a certain level of estimating AA holdings, and no guarantee I havent made errors As of June 30 Capital outstanding £114.8m Free Cash £10.2m Outstanding funding commitments £4.3m Repayment of #1550 knocked a big chunk off potential funding requirements. Obviously the £2m distribution the quarterly update suggested never materialised but good news is should be a much bigger repayment next week given there is £6m+ free cash )or will be once #1238 funds are added to pot) Loans 253 Default 33 (NB includes 6 where holding is nominal) £15m No payment interest June - 29 (£25m incl default but not those default making interest payments ) Repaid 6 Capital repaid £3.9m v scheduled £10.7m (usual can kicking suspects) Drawdowns £646k v scheduled £1.1m Cash flow +£3.2m v £11.6m Interest received c475k representing approx 114% of sum needed to pay 4% before the lender fee. The science guesswork bit ie totally speculative June fees £94m @6.25% - £488k Catchup fees £5m @2.9% - £12k Total £500k Shortfall £25k As of July 31 Capital outstanding £114.2m Free Cash £7.3m Outstanding funding commitments £4.1m Loans 249 Default 41 (includes 7 with nominal amounts) £15m No payment interest July - 48 (£15m incl default but not those default making interest payments ) Repaid 4 (£740K) Capital repaid £1.25m v scheduled £11m (usual can kicking suspects) Drawdowns £350k v scheduled £630K Cash flow +£1m v £11.6m Interest received c459k representing approx 114% of sum needed to pay 4% before the lender fee. Would that free cash be sitting in the client money account?
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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
Posts: 11,315
Likes: 11,523
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Post by ilmoro on Aug 7, 2023 19:20:25 GMT
As of July 31 Capital outstanding £114.2m Free Cash £7.3m Outstanding funding commitments £4.1m Loans 249 Default 41 (includes 7 with nominal amounts) £15m No payment interest July - 48 (£15m incl default but not those default making interest payments ) Repaid 4 (£740K) Capital repaid £1.25m v scheduled £11m (usual can kicking suspects) Drawdowns £350k v scheduled £630K Cash flow +£1m v £11.6m Interest received c459k representing approx 114% of sum needed to pay 4% before the lender fee. Would that free cash be sitting in the client money account? I would assume so, should be in a client account, whether that is the same for free cash in the AA as cash sat in lenders cash accounts no idea.
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Post by chrismellish on Aug 7, 2023 20:55:36 GMT
Would that free cash be sitting in the client money account? I would assume so, should be in a client account, whether that is the same for free cash in the AA as cash sat in lenders cash accounts no idea. It's the same. It's client money, it sits in the client money account. AC has a virtual banking system that sits on top of the client money account segregating the funds into various pots / virtual accounts. So you have one virtual cash account, one for each investment account for uninvested cash, etc.
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Post by garreh on Aug 8, 2023 13:41:56 GMT
Is it possible AC are withholding such a large amount of unneeded cash because it's in a client money account that is earning high interest? chrismellish Do you have any insight into how it was structured? Short term bonds perhaps? |
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Post by chrismellish on Aug 9, 2023 22:37:14 GMT
Is it possible AC are withholding such a large amount of unneeded cash because it's in a client money account that is earning high interest? chrismellish Do you have any insight into how it was structured? Short term bonds perhaps? During my time, it was always held as cash in the client money account and I don't believe it was paying any interest to AC (or was negligible). The same is true of the provision fund money - as far as I'm aware it's always been held as cash.
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Post by garreh on Aug 10, 2023 14:52:56 GMT
Is it possible AC are withholding such a large amount of unneeded cash because it's in a client money account that is earning high interest? chrismellish Do you have any insight into how it was structured? Short term bonds perhaps? During my time, it was always held as cash in the client money account and I don't believe it was paying any interest to AC (or was negligible). The same is true of the provision fund money - as far as I'm aware it's always been held as cash. Thank you for that insight. "(or was negligible)" likely doesn't apply now due to substantial base rate increases. AC shouldn't be holding a large excess cash during this wind-down period, let alone capitalising on it with potential interest. There is strong and clear regulation surrounding client money. This is speculation of course, but seems plausible as a motive given AC have been questionable in their operations for a while now. I hope when queried they will clarify this, or answer to the regulators.
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warn
Member of DD Central
Curmudgeon
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Post by warn on Aug 10, 2023 16:13:15 GMT
Perhaps they're holding on to it for a rainy day, in case their confiscation of our interest turns out not to defray their expenses adequately.
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Post by garreh on Aug 11, 2023 14:42:11 GMT
Finally had a response to my complaint from AC. It confirms what we've all been speculating - they are knowingly front-loading the fees and fully acknowledged it. The Board discussed it, but seems they disregarded concerns. There is some other interesting insights in the response in regards to how the fee might be benefiting their institutional side as well, but I will be saving that with my pursuit in this to the FOS.
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