Intelligent Money

[bitchstewie]

It was a link to the Financial Ombudsman decision that is referenced in the original Citywire article.

https://www.financial-ombudsman.org.uk/decision/DR...

[dingg]

Strange that the pages in the url links i quoted above are no longer available

Am I worried about losing my money. No, its all protected :-)

[Forester1965]

dingg said:

Strange that the pages in the url links i quoted above are no longer available

Am I worried about losing my money. No, its all protected :-)

They're not working because something in the PH mechanism has truncated the URLs in the original post when you've quoted it.

Nothing untoward, just a gremlin.

The links are to the FCA register entry for IM detailing amongst other things the restrictions on the firm and the Citywire article about the situation.

If you go back to the original post you quoted on page 1 of the thread the links ought to work.

[dingg]

Forester1965 said:

They're not working because something in the PH mechanism has truncated the URLs in the original post when you've quoted it.

Nothing untoward, just a gremlin.

The links are to the FCA register entry for IM detailing amongst other things the restrictions on the firm and the Citywire article about the situation.

If you go back to the original post you quoted on page 1 of the thread the links ought to work.

Thank you

Yes just a gremlin in the mechanism

[Rufus Stone]

bhstewie said:

It was a link to the Financial Ombudsman decision that is referenced in the original Citywire article.

https://www.financial-ombudsman.org.uk/decision/DR...

91 pages

[JulianPH]

Firstly, may I thank everyone for their comments.

It is quiet clear that IM has an issue with complaints made against it by (or on behalf of) certain clients who have unfortunately lost money following the advice of their regulated financial advisers.

Regardless of whether a financial adviser selected the investment or not, IM has a duty of care to all of its clients and been held liable for these losses on the basis it did not undertake sufficient enough due diligence on those investments (and in some cases the business model of the financial advisers themselves).

We had considered seeking judicial review on this point, but decided that the uncertainty this course of action would ensure was not in the best interests of our customers and so adopted a different approach.

Confidentiality prevents me from saying more at this point, but all who know us are fully aware of our openness and transparency, so please excuse me if I do not carry on repeating the same points ahead of Tuesday's announcement.

Cheers

Julian

[Forester1965]

A risk in a JR is it might set an adverse precedent if you lose.

Whilst absolutely a big amount of money I wouldn't have thought the legal costs of running the JR on its own would be too excessive in the grand scheme of things compared to the potential value of claims. I guess not too dissimilar to running through the tax tribunals.

Would've thought the decision whether to JR or not depended on counsel's assessment of chance of success.

[Rufus Stone]

There have been many similar determinations against SIPP providers over recent years.

I think it's a crazy world when a SIPP trustee, who isn't authorised to provide financial advice, effectively has to vet the advice provided by an individual/firm that is regulated to provide financial advice.

[TownIdiot]

Rufus Stone said:

There have been many similar determinations against SIPP providers over recent years.

I think it's a crazy world when a SIPP trustee, who isn't authorised to provide financial advice, effectively has to vet the advice provided by an individual/firm that is regulated to provide financial advice.

It is absolutely ridiculous.

[superlightr]

JulianPH]It is not connected whatsoever to clients or their investments[/b said:

(this is client money, held by the trustee and nominees, separately to IM's own money).

Whilst this asset restriction certainly impacts on the shareholders and directors of IM, it has no impact on clients (indeed, this is the entire point).

Cheers

Julian

Good to hear the clarifications. I hope this gets sorted quickly for you all as it must be stressful. As others have said and after reading claim its appears harsh to say the least on IM.

For our complete understand which you may want to save until Tuesday;

Could you confirm who the Trustees and Nominees are? What role do they play?

I understand that Private Client money/investment - Pensions/ISA/GIA is held by Metro bank. Is this a designated client account and thus ring fenced?

With Pensions are there any other protections under regulations ?

AdamIM earlier said Private Client money is 100% safe - is it fully protected or up to an £85k limit?

thanks

Edited by superlightr on Saturday 25th May 12:53

[JulianPH]

superlightr said:

Good to hear the clarifications. I hope this gets sorted quickly for you all as it must be stressful. As others have said and after reading claim its appears harsh to say the least on IM.

For our complete understand which you may want to save until Tuesday;

Could you confirm who the Trustees and Nominees are? What role do they play?

I understand that Private Client money/investment - Pensions/ISA/GIA is held by Metro bank. Is this a designated client account and thus ring fenced?

With Pensions are there any other protections under regulations ?

AdamIM earlier said Private Client money is 100% safe - is it fully protected or up to an £85k limit?

thanks

Edited by superlightr on Saturday 25th May 12:53

Hi James

Yes, it is harsh and I would urge anyone with the time and inclination to read it to do so.

I have set everything out below for all to see/refresh themselves with;

• IM Trustees Limited is the trustee. Like most bare trustees it is a dormant non-trading company whose only function is to hold the pension scheme assets.

• Digital Custody Nominees Limited is the nominee for Private Clients. It is part of Seccl.

• Seccl is the platform provider where the portfolios sit

• P1 is the discretionary investment manager to the portfolios (with Adam and I advising to and sat on the investment committee).

• IMPC provides your information, guidance and support services (as well as its work with P1 on the portfolios)

• IM is the operator of the tax wrappers (pension and ISA).

As can be seen, your money is not actually with IM at all, it is held in trust (or via the nominee) on the Seccl platform, where is is managed by P1.

So to address Adam's point, your money is 100% safe from anything happening to IM (or P1, Seccl and IMPC for that matter) as none of these companies actually hold it!

The companies that do hold it are IM Trustess Limited and Digital Custody Services Limited, both of which are non-trading companies with no liabilities.

The £85k figure relates to FSCA compensation in the event that a regulated provider or adviser goes out of business and you have a valid claim against them, i.e. you have lost money that they did hold for you (as would be the case with a bank or insurance company) or had lost money due to bad advice or fraud.

In the case of IM's complaints the advisers and investment providers both went out of business, with IM being the only other regulated firm left to complain to. IM never once considered it could be found liable, but is was.

Cheers

[Forester1965]

I guess one difficulty is being unable to second guess what an individual ombudsman is going to find and dangerous to test it in court. Especially via JR where the results are less predictable via-a-vis irrationality.

[Rufus Stone]

Didn't Berkeley Burke take a similar determination all the way to the Supreme Court, and lost.

[EddieSteadyGo]

I don't know the details of the IM case, but I feel the regulators are going too far in many cases to try and find someone to blame under the guise of 'protecting consumers'.

Whilst I don't work in Financial Services, I can imagine the threat of large penalties could easily chill innovation and encourage a risk-adverse attitude in regulated companies, which might actually be a hindrance to long term consumer interests.

Plus these penalties, and threat of penalties, will eventually just get added back into product costs everyone will be required to pay, which makes the industry overall less competitive.

I may have mentioned in a different thread, but fairly recently I switched part of my pension from a basic SIPP into a SSAS. The hoops I needed to jump through were ridiculous - and it wasn't the SIPP provider (Vanguard) being obtuse or awkward - they were just responding to the regulations which basically put the blame onto them if they agree to a transfer and then I did something stupid with the money.

At the same time, I understand there is a group of people who are financially naive (gullible?) and who need to protected from themselves, so they don't need to be given the equivalent of an overly sharp knife to eat their dinner. But to continue my analogy, I feel we are on a regulatory path where the goal to keep people "protected" means we are all forced to use the financial equivalent of plastic knives and forks, so no-one ever gets cut.

[JulianPH]

Rufus Stone said:

Didn't Berkeley Burke take a similar determination all the way to the Supreme Court, and lost.

There have been a few such cases, but we decided it was in the best interest of all of our clients to not pursue this and instead accepted the position.

[TownIdiot]

I agree Eddie.

I get very frustrated with my trustees but at the same time I can understand why they are the way they are.

[stuthemong]

JulianPH said:

Rufus Stone said:

Didn't Berkeley Burke take a similar determination all the way to the Supreme Court, and lost.

There have been a few such cases, but we decided it was in the best interest of all of our clients to not pursue this and instead accepted the position.

From reading what happened and from my layman perspective this seems really stty for you, Julian. Sorry to hear you’re/IM are swept up in this.

It sounds akin to IM shareholders letting someone use their racetrack and being held liable for someone crashing a car, despite the punter signing a waiver when coming to the track acknowledging that if they crash their car, that’s on them.

The punter took their car onto a race track, with a 3rd party non-IM related driving instructor that they selected, who despite the punter saying they weren’t good drivers, the instructor encouraged them to turn the TC off.

(The instructor also had a side hustle with kickback from the track towing company….. )

The punter then binned the car.

Now the driver is coming after IM for letting them on the IM track, not vetting the instructor enough, and not stopping them turn their traction control off. A technical obligation apparently to do so, but at what point does a punter not have to accept responsibility for actions they took, and their instructor too? ….. the fca sees the way to extract some losses back is to go after the track owner…

And quell surprise, a bunch of tracks will shut and those who want to go drifting into retirement in plumes of sideways smoke will have nowhere to do it as all the tracks will be shut


(Everyone else’s cars that everyone else owns are still theirs. No one can take someone else’s car. Only IMs shareholder capital in the racetrack is at risk)

Hope it all works out

Edited by stuthe on Saturday 25th May 18:27

Edited by stuthe on Saturday 25th May 18:27

[superlightr]

stuthe said:

JulianPH said:

Rufus Stone said:

Didn't Berkeley Burke take a similar determination all the way to the Supreme Court, and lost.

There have been a few such cases, but we decided it was in the best interest of all of our clients to not pursue this and instead accepted the position.

From reading what happened and from my layman perspective this seems really stty for you, Julian. Sorry to hear you’re/IM are swept up in this.

It sounds akin to IM shareholders letting someone use their racetrack and being held liable for someone crashing a car, despite the punter signing a waiver when coming to the track acknowledging that if they crash their car, that’s on them.

The punter took their car onto a race track, with a 3rd party non-IM related driving instructor that they selected, who despite the punter saying they weren’t good drivers, the instructor encouraged them to turn the TC off.

(The instructor also had a side hustle with kickback from the track towing company….. )

The punter then binned the car.

Now the driver is coming after IM for letting them on the IM track, not vetting the instructor enough, and not stopping them turn their traction control off. A technical obligation apparently to do so, but at what point does a punter not have to accept responsibility for actions they took, and their instructor too? ….. the fca sees the way to extract some losses back is to go after the track owner…

And quell surprise, a bunch of tracks will shut and those who want to go drifting into retirement in plumes of sideways smoke will have nowhere to do it as all the tracks will be shut


(Everyone else’s cars that everyone else owns are still theirs. No one can take someone else’s car. Only IMs shareholder capital in the racetrack is at risk)

Hope it all works out

Edited by stuthe on Saturday 25th May 18:27

Edited by stuthe on Saturday 25th May 18:27

IM have a track !!??!! trackday !!! sounds great. traction control will remain firmly on.

Edited by superlightr on Saturday 25th May 18:58

[visitinglondon]

superlightr said:

stuthe said:

JulianPH said:

Rufus Stone said:

Didn't Berkeley Burke take a similar determination all the way to the Supreme Court, and lost.

There have been a few such cases, but we decided it was in the best interest of all of our clients to not pursue this and instead accepted the position.

From reading what happened and from my layman perspective this seems really stty for you, Julian. Sorry to hear you’re/IM are swept up in this.

It sounds akin to IM shareholders letting someone use their racetrack and being held liable for someone crashing a car, despite the punter signing a waiver when coming to the track acknowledging that if they crash their car, that’s on them.

The punter took their car onto a race track, with a 3rd party non-IM related driving instructor that they selected, who despite the punter saying they weren’t good drivers, the instructor encouraged them to turn the TC off.

(The instructor also had a side hustle with kickback from the track towing company….. )

The punter then binned the car.

Now the driver is coming after IM for letting them on the IM track, not vetting the instructor enough, and not stopping them turn their traction control off. A technical obligation apparently to do so, but at what point does a punter not have to accept responsibility for actions they took, and their instructor too? ….. the fca sees the way to extract some losses back is to go after the track owner…

And quell surprise, a bunch of tracks will shut and those who want to go drifting into retirement in plumes of sideways smoke will have nowhere to do it as all the tracks will be shut


(Everyone else’s cars that everyone else owns are still theirs. No one can take someone else’s car. Only IMs shareholder capital in the racetrack is at risk)

Hope it all works out

Edited by stuthe on Saturday 25th May 18:27

Edited by stuthe on Saturday 25th May 18:27

IM have a track !!??!! trackday !!! sounds great. traction control will remain firmly on.

Edited by superlightr on Saturday 25th May 18:58

Well they did sponsor a race series and PH investors, bizarrely, seemed more interested in hospitality at race events rather than wondering how much they were paying in fees!!!

[2Btoo]

superlightr said:

IM have a track !!??!! trackday !!! sounds great. ? traction control will remain firmly on.

If the (amusing!) analogy is to be followed then I think you could leave that traction control off and still expect IM to pick up the pieces when you bin it expensively into the woodwork.

Julian/Adam, this is all far too complex than my meagre IQ will allow me to grapple with but it sounds like a stty situation. Sorry to hear it.