This blog gives you the latest topical news plus some informal comments on them from ShareSoc’s directors and other contributors. These are the personal comments of the authors and not necessarily the considered views of ShareSoc. The writers may hold shares in the companies mentioned. You can add your own comments on the blog posts, but note that ShareSoc reserves the right to remove or edit comments where they are inappropriate or defamatory.

Clarification re Stock Lending and platform pooled nominee accounts

Kevin Taylor, a ShareSoc member, has pointed out to me in relation to my article page 12 of ShareSoc’s August newsletter, that stock-lending simply does not (should not under FCA rules) take place from standard pooled nominee accounts, the likes of which most retail investors would use.  The FCA’s rules could not be more explicit in this area: “A firm must not undertake or otherwise engage in stock lending activity with or for a customer unless … the firm has obtained the consent of the customer;” From: https://www.handbook.fca.org.uk/handbook/CASS/2/5.html?date=2005-01-13

He also noted that it is ShareSoc’s role to educate the retail investor base to banish this myth, so I am happy to make members aware of this information and thank Kevin for his information.

I remain of the view that stock lending is an opaque activity, hence the ongoing debate about zero fees and fund managers hanging on to the stock lending revenues.

 

Cliff Weight

One comment
  1. rogerwlawson 10th August 2018 at 8:01 pm

    That may be so where there are listed shares held rather than funds in a nominee account, but that surely does not apply to funds who can I think do what they want without the consent of the fund holders. That might also apply to investment trusts. If I am wrong, you will no doubt correct me.

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