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Post by brianac on May 29, 2016 19:01:29 GMT
As Lendy are (we presume) on the hook for this, the PF would be paying them?
Would this be allowed?
i.e. are they allowed to use the PF to reimburse themselves as opposed to reimbursing investors?
Brian
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Post by dualinvestor on May 29, 2016 19:11:51 GMT
As ir stands legally Lendy Ltd, or more accurately the directors of Lendy Provision Reserve Ltd, who are same as the directors of Lendy Ltd, can do whatever they like with the Provision Fund. They, the directors, have been referred to as "trustees" elsewhere whilst this might be the case in commonly understood language it is not legal fact. If they were Trustees there would be severe restrictions on what they could do with the money but as it stands at the moment they are not, unless some material facts have not been disclosed, so they can do whatever they like. EDIT although superficially touched on in other threads it has not actually been established that the fund is represented by cash in the bank in the name of LPRL or by any other means, including cash held by another company, investments or simply an inter-company debt it would be up to savingstream to clarify this matter. |
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Post by brianac on May 29, 2016 19:16:04 GMT
As ir stands legally Lendy Ltd, or more accurately the directors of Lendy Provision Reserve Ltd, who are same as the directors of Lendy Ltd, can do whatever they like with the Provision Fund. They, the directors, have been referred to as "trustees" elsewhere whilst this might be the case in commonly understood language it is not legal fact. If they were Trustees there would be severe restrictions on what they could do with the money but as it stands at the moment they are not, unless some material facts have not been disclosed, so they can do whatever they like. But how would the FCA view Lendy using a provision fund put in place for the benefit of investors for their own rescue? Brian
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Post by earthbound on May 29, 2016 19:18:21 GMT
As Lendy are (we presume) on the hook for this, the PF would be paying them? Would this be allowed? i.e. are they allowed to use the PF to reimburse themselves as opposed to reimbursing investors? Brian hi brianac If you read the present T&Cs carefully, you will find that lendy are not on any hook for anything, and as per the PF, it is completely at the discretion of Lendy/SS , the PF is not an FCA requirement, it is a good will gesture by the company, to be used as they see fit.
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Post by dualinvestor on May 29, 2016 19:19:24 GMT
I am not an expert on the regulatory process but do not believe a Provision Fund is a requirement for a lending platform so apart from use of it bringing up "fit and proper" considerations of the principal(s) behind a platform the FCA would not be interested.
Many platforms do not have provision funds and at least one doesn't on particular products
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Post by brianac on May 29, 2016 19:34:10 GMT
As Lendy are (we presume) on the hook for this, the PF would be paying them? Would this be allowed? i.e. are they allowed to use the PF to reimburse themselves as opposed to reimbursing investors? Brian hi brianac If you read the present T&Cs carefully, you will find that lendy are not on any hook for anything, and as per the PF, it is completely at the discretion of Lendy/SS , the PF is not an FCA requirement, it is a good will gesture by the company, to be used as they see fit. I don't agree with you on this, to my mind this is on the old T&C's PF may not be a requirement, but it is still (imho) something the FCA will likely consider. (actually I reckon more than likely, they will.) Lendy did state that they were going to migrate all loans onto new T&C's, but this never actually seemed to happen (as best as I can determine), whether that was because it was a "just job" that they never got around to, or because it became too complicated/expensive/whatever I can only guess (not an educated one neither) No doubt in due (but slow) course the fog will lift from (some of) this and we may get a clearer picture, but I suspect not everything will be clear even at the end of it Brian
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Post by earthbound on May 29, 2016 19:47:23 GMT
hi brianac If you read the present T&Cs carefully, you will find that lendy are not on any hook for anything, and as per the PF, it is completely at the discretion of Lendy/SS , the PF is not an FCA requirement, it is a good will gesture by the company, to be used as they see fit. I don't agree with you on this, to my mind this is on the old T&C's PF may not be a requirement, but it is still (imho) something the FCA will likely consider. (actually I reckon more than likely, they will.) Lendy did state that they were going to migrate all loans onto new T&C's, but this never actually seemed to happen (as best as I can determine), whether that was because it was a "just job" that they never got around to, or because it became too complicated/expensive/whatever I can only guess (not an educated one neither) No doubt in due (but slow) course the fog will lift from (some of) this and we may get a clearer picture, but I suspect not everything will be clear even at the end of it Brian Hi brianac i base my statements on what i read in the current T&Cs , i have spent over 2hrs today reading carefully the current T&Cs, and the position for SS is actually very clear, that's why they feel no need to come to this forum and make any statements, in fact if they were to make a statement it would be along the lines of "Please read the current terms and conditions" Please don't think i'm disputing your opinion, i'm not, everyone sees the situation different, personally, i look at the T&Cs, you then know where you stand, because me, you and everyone else has accepted them, you may think you have not, but simply logging in to the SS platform means you have accepted them.
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mikes1531
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Post by mikes1531 on May 29, 2016 20:30:31 GMT
As Lendy are (we presume) on the hook for this, the PF would be paying them? Would this be allowed? i.e. are they allowed to use the PF to reimburse themselves as opposed to reimbursing investors? I don't think this really is an issue. When it became obvious that SS were withdrawing the 2% associated with repaid loans from the PF so that it always had a balance equal to 2% of the total outstanding loan portfolio, they were asked what would happen if the PF needed to be used. Their response was that they would top up the PF to restore its balance to the 2% level. The net effect of this is that SS/Lendy effectively would be funding any payments by the PF from their own resources. If SS still intend to follow that policy, there'd be no point in making a payout to themselves for PBL020 because they'd have to turn around and put that money back into the PF. IMHO, I question whether this 'policy' was very well thought out.
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mikes1531
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Post by mikes1531 on May 29, 2016 20:40:43 GMT
EDIT although superficially touched on in other threads it has not actually been established that the fund is represented by cash in the bank in the name of LPRL or by any other means, including cash held by another company, investments or simply an inter-company debt it would be up to savingstream to clarify this matter. IIRC, this has come up before, and in response to requests for evidence of the existence of the PF, SS provided a screenshot of their Barclays online account statement showing the money sitting in a separate account. Someone adept at searching the forum archives probably could find the posting. A cynic would say that the 'evidence' didn't really prove anything because there was nothing to stop SS from transferring the money into the account, taking the screenshot, and transferring the money straight back into SS general funds.
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Post by earthbound on May 29, 2016 20:42:05 GMT
As Lendy are (we presume) on the hook for this, the PF would be paying them? Would this be allowed? i.e. are they allowed to use the PF to reimburse themselves as opposed to reimbursing investors? I don't think this really is an issue. When it became obvious that SS were withdrawing the 2% associated with repaid loans from the PF so that it always had a balance equal to 2% of the total outstanding loan portfolio, they were asked what would happen if the PF needed to be used. Their response was that they would top up the PF to restore its balance to the 2% level. The net effect of this is that SS/Lendy effectively would be funding any payments by the PF from their own resources. If SS still intend to follow that policy, there'd be no point in making a payout to themselves for PBL020 because they'd have to turn around and put that money back into the PF. IMHO, I question whether this 'policy' was very well thought out. a slight addition to the PF question, SS maintain the PF at 2%, if a £6m loan pays up, therefor reducing the loan portfolio, where does the 2% (£120k) go ??
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jonah
Member of DD Central
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Post by jonah on May 29, 2016 21:02:11 GMT
I don't think this really is an issue. When it became obvious that SS were withdrawing the 2% associated with repaid loans from the PF so that it always had a balance equal to 2% of the total outstanding loan portfolio, they were asked what would happen if the PF needed to be used. Their response was that they would top up the PF to restore its balance to the 2% level. The net effect of this is that SS/Lendy effectively would be funding any payments by the PF from their own resources. If SS still intend to follow that policy, there'd be no point in making a payout to themselves for PBL020 because they'd have to turn around and put that money back into the PF. IMHO, I question whether this 'policy' was very well thought out. a slight addition to the PF question, SS maintain the PF at 2%, if a £6m loan pays up, therefor reducing the loan portfolio, where does the 2% (£120k) go ?? The SS Christmas do.... Or more simply, SS general resources. The 2% is effectively deferred fees, at least for loans which exit smoothly.
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Post by earthbound on May 29, 2016 21:06:32 GMT
mikes1531 a slight addition to the PF question, SS maintain the PF at 2%, if a £6m loan pays up, therefor reducing the loan portfolio, where does the 2% (£120k) go ?? The SS Christmas do.... considering the amount i have invested in SS i would expect at least a borbal ( funny word that , how do you spell borbal)
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Post by brianac on May 29, 2016 21:18:06 GMT
considering the amount i have invested in SS i would expect at least a borbal ( funny word that , how do you spell borbal) Bauble? (as in christmas tree decoration type of thing?) Brian
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Post by earthbound on May 29, 2016 21:22:09 GMT
considering the amount i have invested in SS i would expect at least a borbal ( funny word that , how do you spell borbal) Bauble? (as in christmas tree decoration type of thing?) Brian brian... still doesn't look right.. how about bawble? 
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Post by brianac on May 29, 2016 21:27:36 GMT
Hi brianac i base my statements on what i read in the current T&Cs , i have spent over 2hrs today reading carefully the current T&Cs, and the position for SS is actually very clear, that's why they feel no need to come to this forum and make any statements, in fact if they were to make a statement it would be along the lines of "Please read the current terms and conditions" Please don't think i'm disputing your opinion, i'm not, everyone sees the situation different, personally, i look at the T&Cs, you then know where you stand, because me, you and everyone else has accepted them, you may think you have not, but simply logging in to the SS platform means you have accepted them. I think we'll have to agree to disagree on this one, as you seem to feel that Site T&C's trump the original contracts, whereas I feel that the original contracts must prevail (even though it seems, AFAIAA, no-one has ever seen them) as contract is between "Lender" and Lendy ltd, no contract exists between lender and borrower (in law you cannot have a triparteit (sp?) contract) this I suspect is the stumbling block to convert old T&C's to new (and begs question when old T&C contracts were rolled over into DFL's - which contract are they under? new lenders no problem, just the rollovers??) Regards Brian
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