Another mini-bond collapse - Blackmore

[millen]

Not unexpected https://www.standard.co.uk/business/blackmore-bond... Again, some eye-watering commissions paid to 'introducers'.

On a related theme, i don't subscribe to Tom Winnifrith but gather he's penned an expose on the High Street Group mini-bonds.

[JulianPH]

You really couldn't make this stuff up.

Nearly 25% of totall asset raised spent on "management fees" and "introducer payments" over the last two accounting years.

[millen]

What so bugs me is I still receive daily emails from an 'introducer' talking of his latest no-risk 12% pa 'opportunities'. He shows no shame. Just trousers the commission and moves on........

PS if anyone wants recent info on the unhappy Dolphin/GPG saga I'm happy to add.

Edited by millen on Thursday 23 April 15:59

[Condi]

They should really be regulated. FCA very much asleep at the wheel again, and there are hundreds more of the same sort of thing. Often the directors of such mini-bond investment companies have had double figure directorships of companies which have gone bust.

[DonkeyApple]

Condi said:

They should really be regulated. FCA very much asleep at the wheel again, and there are hundreds more of the same sort of thing. Often the directors of such mini-bond investment companies have had double figure directorships of companies which have gone bust.

The trouble is that you would think that when financial products or financial businesses are selling to retail customers but not covered by the FSCS then people would realise that they were at best high risk or more likely, junk or scams. But it doesn’t help. People even know about the FSCS (who couldn’t after 2008!!!) yet they don’t care, they simply do not care, what they want is those double digit returns.

I’ve had numerous conversations over the years with intelligent people discussing the risks of these types of investments, to the point of plainly telling them they won’t evwr see their money again and they always agree with you in the conversation and then just put the phone down and go and buy them!!!

The con works because so many victims are the ones conning themselves. It’s something that I have never been able to get my head around. It’s not stupidity or a lack of education in so many cases and many people even seem to think it’s probably a con before they wore their money but they still do it.

And the other side has been the bent IFAs who have laid waste to workers who became legally able to transfer their pensions. They were descended upon by an army of thieving scumbags who doorstepped them and the moment they signed over their £1m pension pot under promises of 10% returns every year and living like kings and how the financial industry was out to rip them off with low returns just hurled that money to their mates running the fraudulent minibonds for a 30%+ cashback leaving the client with just 70% in seconds. Another 30% of that was used to pay coupon to earlier customers and the rest just taken as costs. The client lost everything the instant they signed their pension over to these IFAs.

And the real criminals were the people who signed off on the change that allowed pensions to be released and when told repeatedly by many of us what was going on just ignored it for years.

[JulianPH]

DonkeyApple said:

The trouble is that you would think that when financial products or financial businesses are selling to retail customers but not covered by the FSCS then people would realise that they were at best high risk or more likely, junk or scams. But it doesn’t help. People even know about the FSCS (who couldn’t after 2008!!!) yet they don’t care, they simply do not care, what they want is those double digit returns.

I’ve had numerous conversations over the years with intelligent people discussing the risks of these types of investments, to the point of plainly telling them they won’t evwr see their money again and they always agree with you in the conversation and then just put the phone down and go and buy them!!!

The con works because so many victims are the ones conning themselves. It’s something that I have never been able to get my head around. It’s not stupidity or a lack of education in so many cases and many people even seem to think it’s probably a con before they wore their money but they still do it.

And the other side has been the bent IFAs who have laid waste to workers who became legally able to transfer their pensions. They were descended upon by an army of thieving scumbags who doorstepped them and the moment they signed over their £1m pension pot under promises of 10% returns every year and living like kings and how the financial industry was out to rip them off with low returns just hurled that money to their mates running the fraudulent minibonds for a 30%+ cashback leaving the client with just 70% in seconds. Another 30% of that was used to pay coupon to earlier customers and the rest just taken as costs. The client lost everything the instant they signed their pension over to these IFAs.

And the real criminals were the people who signed off on the change that allowed pensions to be released and when told repeatedly by many of us what was going on just ignored it for years.

I wish you would just get off the fence mate and tell it as you see if!

I could not agree more. IFA's moan about all of these DB pension transer scams, but every single one of them over £30k (with no exception) was arranged by an IFA.

I do mean all (100%) of these, not just most of them. This was (and still is) the law.

[bitchstewie]

DonkeyApple said:

I’ve had numerous conversations over the years with intelligent people discussing the risks of these types of investments, to the point of plainly telling them they won’t evwr see their money again and they always agree with you in the conversation and then just put the phone down and go and buy them!!!

There's something both deadly serious yet darkly comical about that.

I'm literally a novice investor but it's common bloody sense when you spend 5 mins looking at these things.

I don't get it both how people fall for it and how it hadn't been stamped out of existence by the authorities.

That seems a real failing of oversight as I'm sure that next to all the greedy people there will be some who are genuinely vulnerable or who have put their faith in dodgy advisers.

[DonkeyApple]

millen said:

What so bugs me is I still receive daily emails from an 'introducer' talking of his latest no-risk 12% pa 'opportunities'. He shows no shame. Just trousers the commission and moves on........

PS if anyone wants recent info on the unhappy Dolphin/GPG saga I'm happy to add.

Edited by millen on Thursday 23 April 15:59

I suspect Dolphin hit the buffers re funds in not enough to cover coupon out around the time they strategically changed name and then subsequently stopped paying coupon before last Christmas. Another scheme where the numbers never added up and the model relied on an army of cold callers and IFAs to tap up retail punters.

[DonkeyApple]

bhstewie said:

There's something both deadly serious yet darkly comical about that.

I'm literally a novice investor but it's common bloody sense when you spend 5 mins looking at these things.

I don't get it both how people fall for it and how it hadn't been stamped out of existence by the authorities.

That seems a real failing of oversight as I'm sure that next to all the greedy people there will be some who are genuinely vulnerable or who have put their faith in dodgy advisers.

Over 20 years of having these conversations I have formed the view that there are people who are always going to assist scammers in ripping them off and no amount of protection will help. It doesn’t matter what the product is if the scammer gets onto them then they are going to transact.

That obviously doesn’t mean we shouldn’t still police these things. It’s about getting the balance right. The concept of minibonds is really good and in the right hands they are a great product but the problem is that we know categorically and without fail that anywhere there is light regulation there will be criminal activity. It’s an absolute given and we knew the day minibonds, P2P and those high risk ISAs launched that all the usual suspects would plough into them and use them to rinse out victims and fools. The real problem is that the regulator does absolutely nothing. Not only is it not policing but it is actively ignoring financial professionals who report them. The regulator very much sees its role as that of a manager of toilet cleaners who exists to send in cleaners when someone has stormed into a stall and sprayed st all over it. It does not see its role as one of stopping people from stting everywhere in the first instance.

[Skyedriver]

DonkeyApple said:

The trouble is that you would think that when financial products or financial businesses are selling to retail customers but not covered by the FSCS then people would realise that they were at best high risk or more likely, junk or scams. But it doesn’t help. People even know about the FSCS (who couldn’t after 2008!!!) yet they don’t care, they simply do not care, what they want is those double digit returns.

I’ve had numerous conversations over the years with intelligent people discussing the risks of these types of investments, to the point of plainly telling them they won’t evwr see their money again and they always agree with you in the conversation and then just put the phone down and go and buy them!!!

The con works because so many victims are the ones conning themselves. It’s something that I have never been able to get my head around. It’s not stupidity or a lack of education in so many cases and many people even seem to think it’s probably a con before they wore their money but they still do it.

And the other side has been the bent IFAs who have laid waste to workers who became legally able to transfer their pensions. They were descended upon by an army of thieving scumbags who doorstepped them and the moment they signed over their £1m pension pot under promises of 10% returns every year and living like kings and how the financial industry was out to rip them off with low returns just hurled that money to their mates running the fraudulent minibonds for a 30%+ cashback leaving the client with just 70% in seconds. Another 30% of that was used to pay coupon to earlier customers and the rest just taken as costs. The client lost everything the instant they signed their pension over to these IFAs.

And the real criminals were the people who signed off on the change that allowed pensions to be released and when told repeatedly by many of us what was going on just ignored it for years.

It's a Human Syndrome called Greed.