London Capital & Finance: £236m firm collapses


(Splodf) #21

Then use it for a year and switch out until you have read and understand and agree to the new terms? If you don’t agree to the new terms it was a free 5% for the year previous.

The invest section will be open by then for people who want risk.


(NM) #22

I love how its a none exhaustive list on their own website and its not exactly clear what any of it means to the consumer…
I would love @simonb(Monzo in general) could do article explaining what different FCA licences there are (One of the money advice blogs). As I’m quite confused and it could be very helpful to people.


(Splodf) #23

It’s almost as if the world of finance is so complex by design, so only the richest have access to and can manipulate it to suit their needs ;).

(Complete conspiracy theory).


#24

They are also planning to offer an investment product which offers 5% and buys some emerging markets (e.g. India) credit bonds. This product should net a margin 2% to dozens meaning the original interest rate of the product is >7%.


#25

Can anyone link to a FSCS document that explains exactly what situations this insures against?
All I can find is the following page, which isn’t exactly detailed
https://www.fscs.org.uk/what-we-cover/investments/


(Splodf) #26

That’s completely separate. I’ve got the screenshot from the invest section of you’d like to see it?

It’s essentially ETF and Bond investment. Dozens take half a percent if the value goes up.

Here’s a conversation I had with Aritra about the invest section: https://weare.dozens.com/t/investment-bonds/673?u=codf


(Splodf) #27

There’s this snippet from their page. Still fairly ambiguous.

(this includes bad advice, poor investment management or misrepresentation and negligence claims relating to mis-selling of pensions)


(NM) #28

Is it time to storm the FCA(I’ll grab my torch((not of the tikki kind!)) and my pitchfork)? :joy:
In all seriousness you are partly correct, the manipulation(mis selling etc) of individuals needs to be more rigorously stamped out


#29

For me this is an issue. It’s hard to understand what is and isn’t covered by the insurance so I’m left needing to put faith in the investment firm to do what they say they will do.


(Splodf) #30

I have no real life experience of dealing with the FCA FCSC so I can’t comment.

They might be a great Q&A for Monzo to arrange though.


#31

I’m genuinely interested to know, but unless you’re a professional investment manager who actually knows what they’re doing (:thinking:), how many of you that are in the investment game actually bother to seek professional financial advice? or do you just wing it and hope for the best? It’s a serious question. I personally have never invested in anything, but then risking my retirement plan isn’t my thing.


(Splodf) #32

I’ve not sought investment or financial advice in a one to one session, other then for tax purposes.

I have read Tim Hales: Smarter Investing - highly recommended as a starting point for investment. (An easy jargon free read too) and am an active member of UKPF on Reddit.

That said I’m only really interested in passive investment, so risks are less then other methods.

I guess if you don’t want to learn it yourself, you can use Nutmeg/Wealthify etc to build a diversified portfolio which negates your own poor choice and allows you to have a team of professionals picking options and equities for you, essentially financial advice with action?!? I think Nutmeg even do advice now if that’s what you’d like.


#33

Thanks for replying. I guess though that there will be few responses because there will be people out there who either think they know what they’re doing, or are motivated purely by greed not heeding the old adage that if it looks to good to be true ya de da…

To be honest, I’ve no interest at all in the investment game, but it does interest me that some people are quite literally willing to risk everything in pursuit of the golden fleece only to end up getting fleeced.


(Splodf) #34

Ironically it’s one of the only ways to make 20% from your money in a year.

It’s also the only way to lose that amount too!

If you ever get chance I’d recommend reading: Smarter Investing 3rd edn: Simpler Decisions for Better Results (Financial Times Series) https://www.amazon.co.uk/dp/B00GAYHH8I/ref=cm_sw_r_cp_apa_i_.X6GCbYV6TDGD

It’s really is worth the read and can help you understand why people chase the goose (because if you do it right you can catch it).


(Luke Bebbington) #35

If you can’t understand what you are investing in - then don’t!

Personally Dozens seems like an odd offering and no investment should ever be guaranteed, that’s just not how markets work.

Also, they won’t provide access to their financials or business plan until the raise goes public on Monday. So many warning signs…


#36

I know someone who actually allowed themselves to be talked into cashing in their pension and the poor sod lost everthing. I sometimes wonder what goes through people’s heads.


(Splodf) #37

I do dislike it when people don’t read and just repeat rhetoric.

The 5% is a corporate bond in Dozens. Not invested or buying bonds in anywhere else, check the NEX you’ll see it there. They take this money and put it in a trust + 5%. It is for all intents and purposes a marketing gimmick as the issuances are incredibly limited. This is no different to depsoit limits at your major banks that have a 5% interest account. Just another way of doing whilst you’re working on the bank license.

It’s an investment because you’re buying a bond, but therefore youre also afforded the FSCS protection. I asked why not just make it a straight up savings account directly to Aritra before, because I agree it has caused massive confusion. The answer is, you simply can’t unless you’re a bank.

Also regarding the pitchdeck, Aritra apologised for the pitch deck being late. He wanted to fine tooth comb every word to make sure nothing was ambiguous or misworded. It will be there on Monday. That’s a good thing no? See:

I’m really sad that we’re adopting this ‘if it isn’t Monzo it isn’t can’t have potential’ culture. Not healthy, especially when Monzos dream is to become a marketplace of services.

I hope someone went to jail over this.


(NM) #38

I think what annoys me more is that people think that Monzo is safe investment. It still has operational losses of £37 million.


(Splodf) #39

It’s the sensationalism that irritates me. It’s a new thing for sure. Everyone has to be on top of the latest scandal.


(Luke Bebbington) #40

The risk free rate is currently 0.5%.

They can do fancy structuring to pretend 5% is guaranteed but that is not how markets work. It puts me off, confuses most people and increases risk in my view.

From what I can tell this is a marketing gimmick that isn’t designed to be long term (could be wrong).

Re pitch deck, it seems completely wrong in my view to ask for people’s money with no supporting material. I’m surprised this is legal and is what gives crowdfunding a bad name. You can’t complete an IPO without the proper disclosures.

All in all way too many warning signs for me. I’ll be sticking well away but everybody should do their own due diligence before investing.