Bob's (Semi) Weekly Update Dear Bondholders, Last week I asked Ian to put up the message: “There will be no BWU this week as there is no news that I can discuss. I had hoped to be able to write on one subject this week but due to my NDA I have to wait for BDO to publish the information, and I must remain silent.” The more observant of you will have noted that BDO then 'sneaked' out an update, after close of business the same day. You will also now be aware of the points I wished to discuss within the limits imposed on me by my membership of the AHC. To read the whole document (an absolute must if you haven't done so) please visit the BDO website or read it here: http://www.armhelp.co.uk/wp-content/uploads/2011/11/The-Provisional-LiquidatorsMonthly-Update-for-the-period-4-August-2014-to-30-September-2014.pdf The FSCS, the Claims See 1.5-1.8. You now have it confirmed that the FSCS has paid out over £25 million in relation to Catalyst claims since the scheme began accepting claims on 28 March. If press reports are accurate, and 1,555 cases have been compensated, with 1,200 cases, including Ian Ward and I who have not responded so far, this implies there are around 2,245 cases in the system being processed. Many of these are likely to be clients of Standard Life. I have heard nothing further on talks between SL and HMRC, which are aimed at resolving the issues involved. Given that this could affect bondholders, with uncompensated losses in other SIPPs, we all have to hope that an amicable solution is found soon. Pending Monies, the Ranking of the Bonds, Restructuring and the Exit Process See 1.11-1.18. This is pretty important stuff, and along with my fellow AHC members I eagerly await sight of the legal opinions, this should happen, provided a way to protect the Provisional Liquidator's privilege can be found. Obviously there is no way any of the bondholder representatives, would be able to disclose the contents of those opinions, but I'm very glad that bondholders now have an official, and better picture, of what is going on. Those of you putting off claiming on the FSCS, as they hoped for a reconstruction, will now be aware that a reconstruction will not be part of an official exit process. You will all now have to decide the course of action you prefer in regard to claiming or not. I worked my socks of for around two years on this, and obviously regret that it has come to this, but I have to accept the inevitable. In view of what is written in the PL's monthly update, at 1.18. I have suggested to the European based restructuring proposers that they may wish to use the bondholder websites available to them, to make their offer public and see if there are sufficient bondholders interested to make their scheme viable. To date, I have received no response. If it should arrive between my Updates it will be placed on ARM Help's website, and I have no doubt, on the other bondholder sites. Financial statements and Investigations See 1.19-1.22. So far, the small but consistent responses that we have seen, have included the question, in one form or another: 'How on earth has it taken a year to get this far?' I wish I could answer that for you. I've noted that there are still some readers that think 'Directors and former Directors means Tim Roberts and the Irish three, but it does not. To show the potential scope of any historical investigation, below is as complete a list of Directors, and former Directors, as I have been able to create. Obviously, if there is anyone who feels they have been excluded in error, or feels they have been included in error, they should contact me at the address below and I will amend the list. Directors Universal Management Services SarL Monterey Services SA Euro Management Services SA Tim Roberts Andrew Wilkens Martin Raine Marco Weijermans Fran WJJ Welman Tim Mol Serge Bijens Niall Lambert Rudolf Zandboer Brain Rayment Ronan Collins, Brendan McCoy Ross Carr Representatives Peter Bun & Carl Speecke Peter Bun & Benoit Nasr Benoit Nasr & Gilles du Roy The FSA and Risk Albeit too late to help us, an interesting sea change seems to be under-way which would support the view, that when not issuing a defence of the indefensible 'Toxic' slur on our investments, the FCA and it's sister operations are having some impact on the behaviour of banks. See: http://www.ft.com/cms/s/0/ d06e4ccc-544a-11e4-84c6-00144feab7de.html#axzz3GOM6Yj4w The title is 'First Direct to pay for miss selling complex investment products' and reports on the praiseworthy actions of First Direct in carrying out an internal review and it's plans to pay compensation to customers. However it was the item at the bottom of the FT piece which really caught my eye: “Coutts, the private banking arm of the Royal Bank of Scotland, has set aside £110m for UK customers who might have been sold unsuitable investments over the past 60 years. The 300-year-old private bank uncovered the errors after conducting a review of advice provided to clients dating back to the 1950s. The lender has written to 15,000 UK customers about the situation and started to make payments.” I hope that is not an indication of how long SLS investors in Keydata, ARM and EEA will have to wait for a future FCA, to review the failures of it's predecessors, and offer compensation. Not many of us are blessed with the genes of the late Queen Mother, and therefore are unlikely to be around after 60 years of investing. Going after the IFAs I've returned to this from the last Update, as it lost it's bold sub heading, and looked a bit of a mess when it reached the pdf that Ian posted for me. The post below the link is what I wrote last time. I just wanted to make the observation that I have a feeling in my water that the FCA's sudden interest in encouraging claims against IFA’s, whose clients invested in EEA, is related to the nervousness they showed in relation to defending Miss Cole's attack on the industry. If there were any bad apples who invested their clients in unsuitable investments, they deserve to be hauled over the coals. What worries me, is that the majority of IFAs were almost certainly totally innocent of wrong doing, and any flood of complaints, may result in even more firms going out of business. This could, in my opinion end up with a negative impact on their existing clients. See: http://www.armhelp.co.uk/wp-content/uploads/2011/11/FOS-finds-against-Charteredfirm-in-ARM-ruling-.pdf So what would appear to be a very good settlement for this Greystone client arrives in the same month that the FCA has made another announcement, warning EEA Investors that they should consider making complaints, and claims against their Financial Advisers before certain Financial Ombudsman Service (FOS) deadlines expire, potentially in five weeks’ time. See: http://eeainvestors.com/wp-content/uploads/Press-Article-20140927.pdf Nice of them to give people plenty of warning don't you think? The problem for the majority of ARM investors, is that whereas Greystone were probably the second largest seller of ARM Bonds in the UK, and remain in business, the largest seller Rockingham do not. So no chance of an FOS claim there folks! One day I would like to see an independent investigation into the way in which the FSA acted in regards to Rockingham, and would seem to have failed to consider, once again, the effects of it's actions on those it was supposed to protect. Are you a £150k or larger investor? In what seems to be the way of all things, I've heard nothing further from the proposers for this. I will revert when, and if, I have further information. BDO's next Update is due the first full week in November. BDO announcements can be found at the BDO website, below, or on our website. http://www.bdo.co.uk/arm-abs-sa BDO can be contacted at: [email protected] Just a little reminder, (except where I clearly state I have confirmation or am authorised), I must emphasise that all the above is a personal view of where we are now. I welcome constructive comment on what I've written that can be used to aid readers further understanding. Have a good weekend one and all. Bob Sharpe Bob's Weekly Update No 95 [email protected]