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Daily News Roundup: Wednesday, 15th September 2021

Posted: 15th September 2021


Scam victims ‘abandoned’ by banks

Consumer group Which? has warned that victims of bank transfer scams are being “abandoned” by banks when trying to reclaim stolen money. Which? says measures like the voluntary reimbursement code have failed to adequately protect consumers and provide reimbursement, saying there is a need for stronger action to support victims. Losses linked to authorised push payment (APP) fraud hit £479m in 2020 but reimbursement rates remain low, with banks finding victims at least partly responsible for their losses in 77% of cases assessed since the code came into force. While banks are often not siding with savers, Financial Ombudsman Service figures show that 73% of complaints about APP fraud were upheld in favour of consumers in 2020/21. Which? Money editor Jenny Ross said: “Fraud can have a devastating impact on victims, and it is unacceptable for so many to be abandoned when they turn to their bank to try and get their money back.”

Banks battle for business

Competition for savers has prompted banks to offer customers up to £130 to switch accounts, with sector experts saying high street institutions are trying to lure back customers from new banks such as Starling and Triodos. RBS is paying Reward account customers £100, plus £50 if they make ten transactions a month, while Santander is handing £130 to anyone who sets up a current account. Lloyds has a £100 cash incentive for new Club Lloyds account customers, HSBC is giving £110 to new Advance account customers, while existing Nationwide members get £125 on opening a FlexDirect account and new customers will receive £100. Virgin Money is giving new current account holders £150 towards a Virgin Experience Day.


Sunak: Private equity M&A boom highlights confidence in UK economy

Chancellor Rishi Sunak says private equity firms’ interest in British listed companies points to “a sign of confidence in the UK economy”. Speaking at a conference promoting tech companies, the Chancellor was asked about potential long-term dangers to businesses being taken private. He offered that if international investors are keen to invest their capital in the UK, “that is something that is good news for our economy”, adding: “And that’s what you’re seeing”. This comes with data from the Office for National Statistics showing that the value of deals in which a foreign buyer acquired a UK company hit £19.4bn in Q1 and surged to £27.7bn in the second quarter. However, the volume of M&A deals involving UK firms fell 31% over the quarter, dipping to 381 in Q2 from 556 in Q1.


SEC chair wants private fund fee disclosures

Gary Gensler, chair of the Securities and Exchange Commission, wants private funds to disclose more information to investors about potential conflicts of interest and the fees they charge. A congressional testimony submitted to the Senate Banking Committee also shows that he wants to impose greater transparency on the corporate bond, municipal bond and asset-backed securities market.

Shinsei hires Morgan Stanley for ‘poison pill’ to thwart SBI takeover

Shinsei Bank has appointed Morgan Stanley to help it manage a takeover defence after SBI, Japan’s biggest internet brokerage, made a $1.1bn approach that would increase its stake from 20% to 48%.

Goldman Sachs appoints new CFO

An internal memo has revealed that Goldman Sachs plans to replace its finance chief at year-end, with Denis Coleman - co-head of the global financing group in Goldman's investment banking division - taking over from current CFO Stephen Scherr.


FSCS uncovers adviser phoenixes at CMC firms

The Financial Services Compensation Scheme (FSCS) has alerted the Financial Conduct Authority (FCA) to 412 cases where advisers who worked at firms that defaulted had joined a claims management company (CMC) to bring claims against their previous firm, a practice known as phoenixing. The FSCS has identified 145 such advisers so far in 2021, having previously flagged 267 others to the financial watchdog. In 2020, the FSCS also identified 150 individuals who worked at defaulted advice firms and re-emerged within active regulated IFAs. Earlier this year the FCA announced proposals that would see CMCs banned from managing FSCS claims to which they have a relevant connection.

Bailey questions EU over clearing raid

The Governor of the Bank of England has warned that the financial system could be damaged if the European Union succeeds in a raid on London's currency clearing operations, saying it could undermine efforts to deliver greater stability in the wake of the financial crisis. Andrew Bailey said that if EU officials want to break the clearing system up and take some of the market from the City to the continent, “it is important to consider the risks to financial stability that come with fragmentation”, adding: “This is not an idle, ‘you would say that, wouldn’t you’ from the UK’s central bank: that is a real threat.” Mr Bailey also said that the UK will stick within global financial agreements on regulation, although some rules may differ from those in the EU as both sides need to evolve over time. Mr Bailey said: “Neither of us has got any interest … in diverging from international standards. What we do have is different markets". He also spoke out over suggestions that European politicians are considering imposing more restrictions on London than other major financial centres.

Standard Life to offer equity release

Standard Life is preparing to enter the equity release market, having teamed up with Key to develop a range of Standard Life branded products. The insurer has plans to launch its own products but in the meantime will rely on Key to deliver the products under the brand Standard Life Home Finance.


JPMorgan appointed to advise on Channel 4

JPMorgan has been appointed by the Government to provide advice on Channel 4’s future following a consultation into the possible privatisation of the public broadcaster. The Department for Digital, Culture, Media and Sport could confirm the decision to hire JPMorgan today, sources have suggested.


Lack of housing stock is perpetuating the shortage

The market for selling a home is at its strongest in more than twenty years, according to OnTheMarket research, although potential buyers may see a lack of stock and need to move fast due to the rapid rate at which homes are being snapped up. The poll shows that 73% of buyers feel confident that they will purchase a property within the next three months, while 79% of sellers are confident that their property will be bought within the quarter. The analysis reveals that the speed at which homes are being bought has climbed 6% since August 2020. Reflecting on the market, OnTheMarket’s CEO Jason Tebb says sellers are “encountering challenges in finding a suitable property … due to the well documented lack of stock”, saying this in turn is causing them to hesitate putting their own property on the market, meaning “a lack of stock is perpetuating a lack of stock in the best market in which to sell a property in over two decades.”


JD Sports chief defends £4.3m bonus

JD Sports boss Peter Cowgill has defended his £4.3m bonus as profits surged. Data shows he received £5m last year, including £4.3m in bonuses, even after a voluntary salary cut of 75%. Critics have suggested that the executive chairman should not have received the pay-out after JD received £100m worth of Government support during the pandemic. However, Mr Cowgill said “numbers speak for themselves”, with half-year profits up £300m to a record £364.6m. He added that his bonus payment “was exaggerated” because it had been for 2017 to 2019 and he had deferred it to “show leadership from the front, even though it was overdue”.


Job vacancies hit a record high

Figures from the Office for National Statistics (ONS) show that job vacancies have hit a record high, with the number of available posts rising above 1m in the three months to August. The ONS report also shows that employee numbers were back at pre-Covid levels in August, while monthly payrolls increased by 241,000 to 29.1m. The UK unemployment rate fell 0.3% in the quarter and now stands at 4.6%. ONS deputy statistician Jonathan Athow commented: "Early estimates from payroll data suggest that in August the total number of employees is around the same level as before the pandemic, though our surveys show well over a million are still on furlough."

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