Know your litigation

  1. At a meeting with the LiP Support Strategy this week I expressed the thought that diyLAW was, due to my history, may be too focused on Bank crimes.
  2. Then - out of the blue-  this letter from my wife’s building insurer arrived.
  3. Very briefly she had a central heating leak causing water damage in our home.
  4. The repair of the leak was not insured, she had paid for the repair. The damage caused by the water leak was insured.
  5. The whole of our downstairs is tiled with the same tile. Some tiles were dug up in order to make the repair. Digging them up destroyed them. It has not been possible to match these tiles up, as they had been laid for some years.
  6. I have been attempting to come up with a solution by clever design for the repaired section, rather than dig up the whole of our ground floor to match tiles now available.
  7. In this process, I have been in contact with the builder, the insurers` loss assessor/adjustor, and their surveyor and an interior designer. This has been going on for some six months.
  8. The letter quoted above “voided” my wife’s insurance claim immediately. They took this action because they claimed failure to disclose business use.
  9. The Agent was at all times aware of my wife`s "business". 
  10. My wife had been very open with the Agent, who she knew well as he had previously arranged mortgages for her.
  11. On investigation, the insurer seems to have a strange web presence. It was highly praised in some reviews – that all seem to have been posted within a short period of time - and slated in others
  12. I found the MD`s direct telephone line and had a conversation with him, which he terminated abruptly.
  13. The conversation was about the claim, whether the agent who arranged the insurance: was the insurance company`s agent or my wife’s agent.
  14. It then went onto discuss the meaning of “business” (shades of my ICO/FCA litigation).
  15. The MD suggested my wife should follow the formal procedure: a complaint from the agent to Vasek as they have no direct contact with their client, then the Ombudsman, and then legal action.
  16. This may possibly take forever and a day, and potentially wears the claimant down into dropping the claim.
  17. My wife then suggested I should look at the Act that was being quoted when they “voided” her insurance for alleged “non-disclosure”.
  18. The Act appears to have been updated: it is now virtually impossible to prove “non-disclosure” in order to void an insurance claim where an agent has been involved (as per the Financial Ombudsman`s publication). 
  19. No matter what litigation you are involved in, this episode demonstrates you need to involve others, keep updated and do not rely on the other side`s interpretation of the Law. 
  20. The Law and the Judiciary are invariably fairer than the other side’s presentation to you.
  21. Watch this space!

 

Jeff Lampert


This blogpost is for information purposes and should not be relied upon as legal advice because it does not consider or take into account your own personal circumstances. If in doubt, seek legal advice.

SME solution?

 

  1. A personal friend of mine, Chairman of iconic British brand name company, granted Lloyds Bank (LB) a Personal Guarantee (PG) on part of that company’s debt to LB. Allegedly, the assets of the company were many times the debt to LB. The Chairman was advised by the Bank this was a “token gesture”. Lawyers looked at the Guarantee and advised the Chairman it was the “standard form”.
  2. Within four months LB received an offer for and then sold the debt to a “vulture fund” (VF) specialising in buying brand names. This was against the Chairman`s wishes. Allegedly, LB refused to listen to other offers to buy the debt.
  3. The VF, now owning the debt, demanded and purchased the shares in the Company owned by the Chairman and his family.
  4. The VF then carried out a rapid pre-pack, selling the company back to the VF, at an allegedly very low value.
  5. The VF claimed to the Chairman his PG was now crystallized, and they, not LB owned it. They coerced him into waiving a service contract with a 10% holding of the company.
  6. As with many other iconic brand companies purchased by this VF, the company has now gone through another insolvency process.
  7. It seems this VF is better at using or abusing our insolvency rules and PGs than running iconic British brand companies, at a substantial cost to the UK`s brand name heritage. Supposedly just this brand was worth more than £100m.
  8. Misusing the purpose of PGs was part of this process.
  9. Perhaps, the ultimate misuse of PG’s was when NAMA sold several billions of loans to Cerberus for roughly 25% of face value.
  10. Cerberus then sold these loans to the Guarantors for roughly 50% of the Guarantee value.
  11. Cerberus made 100% gross profit on the transaction.
  12. Signing a PG again is tantamount to signing a blank cheque. (https://thelawdictionary.org/personal-guarantee/)
  13. When you sign a Guarantee you are not told it can be sold to a third party.
  14. The secured lender has little or no responsibility to the Guarantor to collect the debts from the borrower before calling on the Guarantee.
  15. Neither does any insolvency practitioner appointed by the secured lender have any worthwhile responsibility to the Guarantor to collect from the borrower before the Guarantee is called on.
  16. It is not surprising that signing a Guarantee is the same as signing a blank cheque.
  17. In my case, I took top legal advice and I signed a £500k Guarantee of “last resort” of the debt of Heritage plc.
  18. The receivers appear to have collected £5m against a debt of £3m from Heritage plc to LB. My Guarantee was called on, but I have no idea where the missing recoveries are.
  19. The Receivers have little “duty of care” to the Guarantor.
  20. Further, in my case, LB appear to have entered a perjured Affidavit to claim a false £1.5m shortfall against the £3m debt to justify the call on my Guarantee.
  21. The FSA investigated the Heritage recovery figure in 2008, but refuse to provide me with the result of that investigation.
  22. My attempts to see that investigation through the Freedom of Information Act are now in the Court of Appeal and the Upper Tier Tribunal.
  23. A PCP against the alleged perjurer is in a Bristol Court.
  24. A PG is again a blank cheque. PGs need to be regulated.
  25. Why did Hector Sants, when he was head of the FCA, resolve the PPI situation by bringing an action through the Courts? http://www.telegraph.co.uk/finance/personalfinance/insurance/8462864/PPI-banks-lose-battle-against-FSA.html
  26. Why is Andrew Bailey attempting to put the PG situation under the FCA’s dust-laden carpet?
  27. I suggest the UK urgently needs a Tribunal Service to look at the abuse of PGs.

Jeff Lampert


This blogpost is for information purposes and should not be relied upon as legal advice because it does not consider or take into account your own personal circumstances. If in doubt, seek legal advice.

Déjà vu

At the SME Alliance Meeting in the House of Commons following the debate on RBS
treatment of SMEs
on Thursday, 18 January


Jeff Lampert, the founder of diyLAW, declared "deja vu".


The similarities between two debates on the same subject, nineteen years apart, demonstrate that regulation of banks has gone backwards. Lloyds Bank and RBS were mentioned in both debates, but in the one in May 1999 RBS was praised, not criticised.

The FSA was not mentioned in May 1999, the FCA was rightly heavily criticised yesterday.
Jeff Lampert currently has ground-breaking "once removed" litigation against the FCA.
Asked to comment Jeff said " if the Government had acted properly after the first debate, the content of the debate yesterday would not have been so heart-breaking"...


This blogpost is for information purposes and should not be relied upon as legal advice because it does not consider or take into account your own personal circumstances. If in doubt, seek legal advice.

Litigation in London v Litigation in Lisbon

When Heritage Plc was closed in 2  hours by Lloyds Bank in 1996 two litigations followed. One in London against Lloyds Bank and Grant Thornton (GT), one in Lisbon, against members of the establishment. Some topline comparison between the two jurisdictions is interesting.

The Lisbon one has just been settled and I am receiving €400 pm into an account I have recently opened in Cascais, Portugal. Not a princely sum, but the original investment was only £50k. The London litigation is ongoing and is for a significant amount.

I started Heritage in 1980. By 1982 it was looking to expand into ceramic housewares. I “stumbled”  across a manufacturer of throw-away ceramic pate dishes, Cerexport; between us we developed Heritage pottery a range of oven-to-tableware. The pottery was very profitable for both of us: we both floated on our different stock market 5 years later.

I was offered pre-flotation Cerexport shares. A director of Lloyds Merchant Bank who was advising me on Heritage’s forthcoming flotation asked if he could also benefit from this. We both bought £50k. These purchases were facilitated by a company owned by Cerexport’s marketing director, who was also a director of Heritage.

Cerexport’s flotation coincided with Black Monday and a fall in share price.  The Lloyds director suggested he got our cheques stopped, which I did not allow. Both the Lloyds director and I received a certificate from a Lisbon stock broker confirming they were holding our (bearer) shares. The very day that Lloyds Bank appointed GT as conflicted Admin Receivers to Heritage the marketing director of Cerexport was in London discussing the logistics of a £500k order for a Woolworths promotion. The appointment came as a surprise to everyone. Going forward it was suggested that if necessary we could start a new company, starting with that Woolworths-order.

When asked what I was going to use as finance, I suggested we started with the shares in Cerexport. To which I was asked, “what shares?”. Coming, at that time, from someone I had considered a friend was a nasty shock. The Lloyds director and I took our share certificates to the Portuguese Stock Exchange, who investigated. They (CMVH) confirmed we had been the victims of a crime, by this time eleven years ago.

The first difference I then became aware of was that Portugal had a limitation of 10 years on criminal actions, unlike the UK, where there is no limitation on crime. CMVH suggested we bring a civil case, which was not subject to limitation, as it would be in the UK, and CMVH would support such an action. The action was against 3 defendants, the Marketing Director of Cerexport, the stockbroker who provided the certificates and the owner of the brokerage who also at that time ”owned” Cerexport. A bank that had subsequently bought the brokerage was involved as an “interested party”. CMVH also said that the defence was roughly translated that each defendant was claiming that another defendant had committed the crime. Our first firm of solicitors, who were happy to accept the case on contingency, was, in fact, a Brazilian firm, who had no right of audience before a Lisbon court. Where we had believed this firm was instructing barristers, they were, in fact, instructing an entirely independent firm of advocates, who were not part of the contingency arrangement.

The second thing we learnt is that Lisbon has advocates, not solicitors and barristers. Our next firm was a small firm that was relocating from London to Lisbon. I went to Lisbon, met with our new solicitor and the solicitors from the other side, and thought I had agreed a settlement. Subsequently, I was advised that it had not been agreed by all parties. My new solicitor, whilst pointing out that I had a brilliant case, now wanted a monthly retainer to continue.

The third thing I learnt was to maintain my cynicism. The Lloyds director did not continue with the litigation. The next firm of advocates was what I thought a branch of a British firm. When the Lisbon office started to chase me for fees that had not been agreed, I found out that the London and Lisbon offices were no longer connected. I clearly had a case proven to a criminal level, but could not find a professional in Lisbon to bring it. With my two words of Portuguese, I could not do that myself. Through the Chamber of Commerce I met ME and F. Particularly I liked Miguel Costa from that firm. We agreed a fee. Sometime later I was called over for a Hearing in Court.

I was aware that in Lisbon everyone pays their own costs, win or lose. Which was fortunate as one of the defendants was being represented by the former Attorney General of Portugal. There appeared to be a number of untruths in the evidence submitted by the other side. Miguel explained that Portuguese Courts have more tolerance of perjury than UK ones. The Hearing was conducted by a professional Judge. Yet another difference from the UK was that Judges become trainee judges without first being barristers.

Lisbon has a different concept relating to disclosure. Disclosing the CMVH report, I disclosed my entire case. I was cross-examined by the Judge, then the advocates for the defence. Then I was sat down with my interpreter next to the main defendant, and the Judge cross-examined us in tandem. To some of his answers, the Judge commented a Portuguese word which Miguel translated for me as “incredible”! The Judge found for me and also fined the main defendant €800 for litigating in bad faith.

The Judgment was appealed on the grounds that I MAY have collected the shares from the stockbroker. Miguel then did a brilliant job proving a negative.

 

 

Dedicated to my friend Miguel Costa who very sadly died in the recent forest fires in Portugal.

 

 

 

Update from the late Miguel Costa`s firm in Portugal:

Dear Jeffrey,

Thank you so much for this great article! We are very grateful for your action.

Miguel would be very flattered for your kind words.

Sofia

Martínez-Echevarría & Ferreira – Sociedade de Advogados


This blogpost is for information purposes and should not be relied upon as legal advice because it does not consider or take into account your own personal circumstances. If in doubt, seek legal advice.

Personal Guarantees are the new PPI scandal

The potential costs to secured lenders from illegal Personal Guarantees will dwarf the costs to the banks of PPI.

diyLAW, the legal information hub is launching its new website this week.

Founded in 2011 (as Help4LiPs) by Jeff Lampert, diyLAW aims to help Litigants in Person (LiPs), who are trying to resolve their legal disputes using the legal process despite being unable to afford legal representation.

Mr Lampert has been a LiP for twenty years.

Mr Lampert founded the website (diyLAW formerly H4L) after his company (Heritage PLC) was closed by its bankers Lloyds Bank, when it was within all of its banking covenants,  Mr Lampert then uncovered that Lloyds Bank had misled the Courts and that his Personal Guarantee (PG) had been illegally called on. He has since discovered that PGs are frequently abused by secured lenders. In the case of Heritage plc, there was more than sufficient funds to meet the debt, yet the guarantee was still called on.

As a result of this illegal call Mr Lampert and his family were evicted from their family home and was personally made bankrupt. Mr Lampert is fighting a legal battle, through the courts, to obtain the release of the documents compiled by the Financial Service Authority (FSA) during their investigation into his case. Mr Lampert is advised that many other SME owners have been evicted from their homes due to the precedent set by the decision reached in his case.  That decision was based on a perjured Affidavit by a Lloyds Bank employee.

diyLAW is actively engaging with many SME owners, who are increasingly aware of Personal Guarantee issues.

SME borrowings are decreasing. SME Research and Development investment is decreasing. SME productivity is suffering.

In the last week, Mr Lampert has written to both the Treasury Select Committee (TSC) and the head of the two financial services regulators (The Bank of England and Financial Conduct Authority) seeking details of the formers FSA’s investigation.

 

A copy of this letter can be found here.

 


This blogpost is for information purposes and should not be relied upon as legal advice because it does not consider or take into account your own personal circumstances. If in doubt, seek legal advice.

Renaissance Accounting (before 1600 AD)?

This is Help4LiPs` leaflet produced for the Civil Justice Council forum on Access to Justice for Litigants in Person on 4th December 2015.

 

http://www.help4lips.co.uk/litigants_in_person_help_litigants_in_person_with_diylaw.html

Justice is moving into the 21st century very rapidly.

https://www.judiciary.gov.uk/wp-content/uploads/2011/03/cjc-national-forum-on-access-to-justice-for-lip-summary.pdf

 

When is the accounting profession going to do something similar, and move away from the renaissance concept of double-entry bookkeeping?

 


This blogpost is for information purposes and should not be relied upon as legal advice because it does not consider or take into account your own personal circumstances. If in doubt, seek legal advice.

Behaviours of RBS GRG and Lloyds Banking Group

Judge Beddoes ratio decidendi in the Turner case with Lloyds Banking Group encapsulates the issue facing victims of both banks’.

The banks’ have no idea how their persistent denials, obfuscation and blatant lying to the Courts impacts on the victims, taxpayers, employees and wider community lives.

Lloyds Bank also need to put a few billion or so aside to compensate their customers that fell victim to BSU, which the board deny any wrongdoing. They are complicit in one of the biggest denials in banking history. RBS are no different.

 

Judge Beddoe hit the nail on the head when passing sentence.  The FCA and bank board did nothing to help victims Paul and Nikki Turner.

They (LBG) have the audacity to appoint a friendly Judge to oversee claims. Talk about club membership. This cabal has to be broken and the Judiciary allowed to act in accordance with Banking Practice and Law.

Bankers have to be qualified and licenced, as are most other workers in the land. Never again should the unqualified, unprofessional, unethical, immoral, Buccaneers and traders be allowed to bankrupt the country. £455bn Quantitative Easing is a massive bribe by the Government to protect their buddies who are fraudulent as all the banking fines witness. Fines equate to corruption. How can a bankrupt firm pay bonuses? This is unheard of in insolvency practice?

The FCA has no option but to withdraw Lloyds Banking Group banking licence and RBS licence. The Icelandic Government did with great effect on the banking industry in Iceland.

Quite honestly, The Chairmen past and present are abject failures and should be banned from having anything more to do with banking . They deny all wrong doing over a decade, only to be found out by an honest Judge, who understands banking and egregious fraud. He should be honoured.

His criticism hit the core problem, bankers are prepared to throw vast amounts of taxpayers money into Court, knowing full well that innocent victims cannot hope to match their dirty tricks departments.

The bank lawyers do not know or understand Banking Practice or Law and how these are inextricably linked to form the banker/customer relationship.

RBS and Lloyds Banking Group (owners of HBOS for 8 years with constant denials from the boardroom and whitewash reviews see Judge Beddoes ratio decidendi) are unfit to be bankers. There philandering CEO is not fit for purpose. Lloyds Bank is now a subsidiary of Blackrock a US firm. The government sold most of their shares to them . God help their customers in the future, how can US banks’ understand UK Banking Practice and Law. They never will.

The SMEs and public demand truth, integrity, honesty, fidelity, prudence, morality, ethical banking standards from their bankers, nothing less will suffice. They also demand the same from the FCA who are currently hamstrung by government which directs operations to keep their buddies in situ thus preventing Justice for the victims.

The alleged Intermeddling of government with the Courts to protect their future job opportunities upon leaving government by influencing outcomes is obscene.

Judge Beddoes condemnation of the Regulatory failings is a warning to RBS lawyers, the truth always is unequivacable.

The FCA has to be independent of government and FSMA 2000 needs to be redrafted to permit the FCA to operate without fear of government influence, to facilitate intrusive, robust regulatory oversight, and where necessary to enable the FCA to remove banking licences.

The perpetual fining of banks’ is not the price of doing business in London.  It is a tax on all bank customers and taxpayers. Totally unacceptable.

How can London ever expect to be the financial centre of the western world when no one can trust the boards’ to act and behave honestly? It is a given that KPMG, RBS, Cerebus will obfuscate, lie, and destroy victims integrity in pursuit of there own gains. It is a given that the board of Lloyds obfuscated, lied and whitewashed reports by their appointed investigators for over eight years. Judge Beddoes saw through their lies and has set the platform for further litigation for innocent victims. Both Chairmen and boards’ should resign immediately. The FCA should be permitted to step up to the mark without government interference. Let them do their job as Regulator!

Using taxpayers money to throw at prolonged court trials to defend the indefensible is obscene. The APPG recommendation for an independent Tribunal is the only ethical and moral response that government can invoke.

They have brought my revered profession into disrepute and the public are the only people that have the power to effect change by the government.

 

Professor Nigel JD Harper


This blogpost is for information purposes and should not be relied upon as legal advice because it does not consider or take into account your own personal circumstances. If in doubt, seek legal advice.

Unproductive SMEs, Personal Guarantees and Bonuses

  1. Banks create money when they issue a loan to a client.
  2. That money only exists in the bank’s and the client’s books.
  3. The current rules of creating money encourage and incentivise banks to create money. They only make money on the spread between their asset book and their liability book. Because of state deposit guarantees and the Central Banks lender of last resort, people and businesses are happy to accept almost zero interest to hold their money in banks. Without government backing, banks would need to offer depositors a much higher interest rate. If this was 2% then the effective subsidy to UK banks is ~30bn pa (i.e. 2% * 1.5 trillion of ‘sight deposits’)
  4. The client agrees to the terms of the loan, which are prepared by the bank.
  5. In many cases, the client is not able to get the loan without signing a ‘Personal Guarantee’ (PG). A legal definition of a PG can be a “blank cheque” (presumably limited by the amount of the loan).
  6. The client is signing over his own personal assets to guarantee the repayment of the created money.
  7. The client often has little understanding of what he is signing, nor does he enjoy good, relevant legal advice.
  8. What he is signing is a contract based on the created money.
  9. In many cases, this contract states the bank can call on this loan on demand.
  10. This on-demand call will trigger the PG. In a high number of cases, the Secured Lender goes straight to the Guarantor for repayment of the loan.
  11. Bankers are incentivised by bonuses to operating this churn.
  12. This money goes to the bank`s profit and bonuses for bankers are paid on profits.
  13. The banks create money by this process and the client loses the assets used as guarantee collateral.
  14. Any litigation is brought under Contract Law focuses only on the contract signed between the client and the bank. The banks are clearly experts in this area, and anyone attempting to bring an action against the bank faces the might of the bank’s unlimited access to funds, legal experience and ability to delay. Essentially, banks have both the incentive and resources to fight battles that they may win simply by being able to argue for longer.
  15. The banks use top branded firms to convince the courts of some peculiar accounting practices. The Courts in that sense are exposed to experts. Introduction to intercompany debt – concept: youtube.com/watch?v=lD-sxnjNdjs
  16. As a result of this practice, which started in the 1990s, many SMEs are no longer seeking bank borrowing to fund research and development. SME loans have been falling since the financial crisis. Using the data on https://www.bba.org.uk/news/statistics/sme-statistics/bank-support-for-smes-1st-quarter-2017/#.WZ7tHCiGPD4we can see that bank lending to SMEs over the last five years has been a net negative, falling by ~10bn since 2011.
  17. Funding research and development is, by definition, a risky business.
  18. The practice of banks channelling credit into non-productive uses (e.g. mortgages for pre-existing houses) rather than productive uses (e.g. to SMEs to fund investment and R&D, that creates jobs, and increases the economy’s supply potential) may be one of the reasons why SME borrowing has reduced and why the UK is falling behind other parts of the world in productivity.

 

Feel free to weigh in below in the comment section.

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This blogpost is for information purposes and should not be relied upon as legal advice because it does not consider or take into account your own personal circumstances. If in doubt, seek legal advice.