FCA

They Do Things Differently in the USA

Former Autonomy CFO Sushovan Hussain has been found guilty of 16 counts of fraud in a Federal Court in California. He was convicted on all 16 counts of wire and securities fraud. This case was based on allegations of false accounting to ramp up the value of the Autonomy business prior to its acquisition by Hewlett-Packard. The latter subsequently wrote down most of the $10.3 billion cost of that acquisition. More background on this case is given in a previous blog post ...

Aviva Preference Shares – FCA Announcement

Readers who take any notice of financial affairs will be aware of the furore over the threat by Aviva to redeem their preference shares by a “share cancellation” process – they claimed that is a different legal process, even though the shares were described as “irredeemable”. The shares concerned dropped in price to a significant extent because their high coupon interest rate meant they were trading at a premium when cancellation would have meant redemption at the original par value. Aviva ...

Aviva Preference Shares: Write to your MP!

Please write to your MP requesting that a Parliamentary Select Committee investigate Aviva’s action. The Financial Times published a joint letter from Peter Parry of UKSA and Cliff Weight of ShareSoc, highlighting our concerns. The suggested wording of a letter/email to your MP is as follows "Dear xxxx, A Parliamentary Select Committee should investigate Aviva’s actions which have sullied the reputation of the London Stock Exchange and may cause financial losses running into billions for many individuals. The issues are highlighted in a joint ...

Conviviality

It is a great name for a bar, but is a fancy name good for a quoted conglomerate plc? The shares were suspended on 14 March. The FCA and FRC need to look at this and asset managers need to think again why they missed the warning signs! Shares in the wholesaler and distributor of alcohol and impulse are now suspended as it considers the anticipated impact on its funding position of £30m due to HMRC. This business has looked questionable since ...

ShareSoc will Demand Action from the FCA over Account Switching Delays

Earlier this month I read this Times article concerning disgruntled clients of Barclays' Smart Investor platform. It highlights once again the longstanding issue that changing your provider of share trading services (stockbroker or platform) is often a painful process. It is not unusual for the switch to take several months, during which you may not be able to sell shares that you own or access funds held in your account. I find this unacceptable in the 21st century, when modern IT systems ought ...

Revenue Recognition, Patisserie Valerie, Utilitywise and Cryptocurrencies

Revenue recognition is a hot topic at present as folks have come to realise that this is a frequent cause of company accounts misrepresenting the true state of the business. Quindell and Blancco are two examples and I cover Utilitywise below. But first let me report on the Annual General Meeting of Patisserie Valerie (TIDM:CAKE) which I attended this morning (as a shareholder of course). The company operates a chain of cake+coffee shops under the company name but they also have several ...

Regulation of shareholder action groups following the debacle of the RBS case

Regulation of shareholder action groups following the debacle of the RBS case (see http://www.thisismoney.co.uk/money/news/article-5266449/Demand-probe-RBS-Shareholders-Action-Group.html ). As regards the suggestion that such groups be “regulated”, I do not see how that would necessarily assist to protect the interests of shareholders. Indeed, it might result in even more involvement of lawyers when one of the big problems is that legal firms often set up and run such groups and this is often in their interests rather than the claimants. Introducing regulation would also make ...

Private Investor Dialogue with the FRC

Following the success of the last year's FRC event (photo below) a date of 26th November 2018 has been agreed for a Private Investor Dialogue with the FRC. Please put the date in your diaries. More details will follow later in the year.   Click here to see the feedback survey results of last year’s event. The FRC were very pleased with the event and the feedback research. We continue to have regular meetings with the FRC and are increasingly being invited to ...

Want to Get Rich Quickly?

Do you sincerely want to be rich? That was the sales slogan used by fraudster Bernie Cornfeld which attracted many. Or perhaps even better, do you want to sincerely get rich quickly? That is in essence the sales pitch used by many promoters of CFDs (Contracts for Difference). CFDs are geared investments in stock market shares, bitcoins, commodities or any volatile instrument where you can magnify your profits many times. Or, of course, magnify your losses. You can, to put it simply, ...

FRC Corporate Governance Consultation and FCA Consultation on Competition

The FRC has launched a consultation on the Corporate Governance Code. https://www.frc.org.uk/consultation-list/2017/consulting-on-a-revised-uk-corporate-governance-co The FCA has launched a Consultation on Competition https://www.fca.org.uk/publication/corporate/our-approach-competition.pdf ShareSoc will most likely be making a joint response with the UK Shareholders’ Association to both of these consultations. You are welcome to send your views to cliff.weight@sharesoc.org . Peter Parry and I will consider them in making our response. You are also welcome to submit your own comments/response directly to the FRC/FCA, but please state that they are your views (you cannot assume that ...