Brief:
I recently read an article that spoke about the FCA which is the Financial Conduct Authority being under government investigation due to their oversight of “LCF” London capital & finance after customers of the firm lost a lot of money in a bad investment. The article states that around 11,605 people invested a total of two hundred and thirty-six million pounds, with the majority of this being lost, with the belief that only around 20% will be recovered which is around forty-seven million. A statement from The Economic Secretary to the Treasury, John Glen stated;
“By ordering this investigation, we will better understand the circumstances around the collapse and make sure we are properly protecting those who invest their money in the future.”
One of those people that invested her money stated that her life savings have been wiped out, as the LCF enables the consumers to invest that money into a high-risk investment called mini-bonds. It was that the LCF was doing some irregular business as sever independent financial advisers had said that they warned the FCA back in 2015 of these irregularities. It is believed that it will take around two years just to get back around a fifth of the capital people invested with LCF.
Opinions:
Whilst reading this article I had a lot of mixed opinions and feelings. There were also a lot of questions that were raised in my head, the first was how would the FCA not pick up on all of the issues that everyone seemed to pick up on while they were looking into the company, the other question that was raised was, why on earth would you invest all this money and not do prior research to see if it actually a good investment, these two questions were the reason of the mixed opinions. First and quite obviously I had a lot of sympathy for the people that lost their money because based on the report it was a lot of money, yet this is also where the counter options kick in, there was one quote in the article that rather annoyed me a women named Amanda Cunningham was one of the people that lost money in this bad investment, she stated “Basically, it will mean that my son will not have money for his future,”. The reason this quote annoyed me was because she has completely shifted the blame on the LCF, now yes the company should not have allowed a risky investment, yet this woman as well as all these other people chose to put their money, Amanda putting her life savings into this risky investment, without doing any other research, if it were me and I were putting a lot of money into an investment I would do the research needed to ensure that the investment is a good one.
Leave a Comment:
Please feel free to leave a comment and let me know what you think about the article and let me know if you agree or disagree.
https://www.bbc.co.uk/news/business-47773404
EIBMU5006Harry18075236 