argyrotsipi/train-dataset huggingface dataset:
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill — House of Commons, 2021-09-22
Topic: Domestic Commerce
Kevin Paul Hollinrake (Conservative, Centre-right): It is a pleasure to have the opportunity to debate these issues. The amendment tabled by the hon. Member for Glenrothes (Peter Grant) is interesting. Certainly I very much support the broad principle of greater scrutiny of the FCA, but I cannot support his amendment because I do not feel that it is effective, not least regarding the issues I raised earlier. Some of the issues in it have already been addressed. The regulatory failures were clearly identified in the excellent Gloster report. The report also—this was welcome—named individuals in the FCA who had failed and who tried to have their names redacted from it and exempted from any specific criticism. One of the cultural issues with the FCA is the lack of individual accountability either in the organisation itself or the organisations they regulate. In subsection (5)(e) the hon. Gentleman talks about why we are compensating only 80% of the losses of individuals who lost money in London Capital & Finance. That speaks to a broad principle. Many of the investments people make have to be subject to the principle of caveat emptor. Especially with a relatively high-risk investment, it is incumbent on any investor to look at it and judge the risk for themselves. Some form of protection from the regulator is also required, but the regulator cannot be all things to all people and cannot be in all places at once. I had a constituent come to me who had lost a significant amount of money in London Capital & Finance investments, and they were quite clear that they understood that as they were getting an 8% return, whereas in a bank they would probably get 0.5% maximum in interest, there was a risk involved in such investment. It is quite obvious to most people that that is the case, whether they are sophisticated or unsophisticated investors. The broad principle of an investor having to look at the investment and judge for themselves is very important.
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill — House of Commons, 2021-09-22
Topic: Domestic Commerce
Kevin Paul Hollinrake (Conservative, Centre-right): Anybody reading the report will be appalled by the regulator’s performance in this case, given not just the number of complaints about LCF but the lack of joined-up thinking within the FCA. This was some years down the line; it happened after Andrew Bailey had taken over at the FCA. He knew there were problems right at the start, but there was no joining of the dots and there were the clear allegations of inappropriate conduct within LCF. The independent financial adviser who drew attention to it was a very competent person; he was not simply raising the issue saying, "I don’t like this company." The IFA was called Neil Liversidge. He wrote to the FCA setting out exactly what was going wrong with the designation of unsophisticated investors as sophisticated, the encouragement to class themselves as sophisticated, and where some of the investments were going. It was pretty clear what the problem was at LCF, and the FCA failed to act. That is simply unacceptable. That is why I welcome the compensation. However, it still has to be down to investors to make an educated decision. Certainly my constituent and others I have seen could see that this was not a Government gilt they were investing in; there were obviously some risks attached.
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill — House of Commons, 2021-09-22
Topic: Domestic Commerce
Kevin Paul Hollinrake (Conservative, Centre-right): That is very welcome The key point in the amendment is about oversight. I am concerned that the FCA is not as accountable as it could be to this House. With repatriation, a number of regulations and regulatory oversight of the FCA have now passed back to us domestically whereas before there was accountability through the EU institutions. I am concerned that we have proper oversight of what the FCA does. The hon. Member for Glenrothes and the hon. Member for Harrow West (Gareth Thomas) are quite right: the jury is still out on the FCA. It has made some bold claims that it is reforming and becoming more effective. I welcome the fact that only a couple of weeks ago it set out some clear targets for a reduction in the number of investors investing in high-risk investment and being subject to scams. There are some specific criteria that the House can now hold it to account for; I am just not clear how we do so. I can see how the Treasury does so, but it is important that the House can, too In the work that I have done on the all-party parliamentary group on fair business banking, we have seen numerous cases in which the FCA has not been proactive or used the mechanisms at its disposal to sanction the people responsible. That is simply unacceptable. The FCA must be a much more proactive organisation and, for it to be held account for such proactivity, we need a clear line of responsibility between it and the House and its Members. The amendment is a good attempt, but not one that I can support.
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill — House of Commons, 2021-09-22
Topic: Domestic Commerce
Atta-Ur-Rehman Chishti (Conservative, Centre-right): I really appreciate all the work that the hon. Gentleman has done on this matter. On the consumer duty, my concern, raised with me by local residents, is that the company was allowed to continue trading without investigation in 2015 after warnings of malpractice and maladministration. With his expertise and experience, does he think that, whether through the consumer duty or further regulation following the Gloster inquiry, the measures proposed would prevent what happened in 2015?
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill — House of Commons, 2021-09-22
Topic: Domestic Commerce
Atta-Ur-Rehman Chishti (Conservative, Centre-right): The hon. Gentleman’s idea of an independent committee should be considered among the wider tools to get the right support for consumers. Of course, I have admiration for him because, being a fair man, I see he also went to the University of Wales Aberystwyth, and we were taught at university always to respect other colleagues’ talents. That is why I respect his expertise on this matter.
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill — House of Commons, 2021-09-22
Topic: Mixed Topics
Atta-Ur-Rehman Chishti (Conservative, Centre-right): I thank the shadow Minister for giving way, and I will of course raise the same point with the Minister in due course. The right hon. Gentleman says that the victims will of course welcome the compensation coming their way, but the point raised with me by those who have suffered a loss is whether the Government can look to prioritise those who have suffered the most due to their loss. There has been a lot of data gathering by the FSCS, the FCA and the Serious Fraud Office, so that should be easily apparent. What is his view about ensuring that compensation is quickly given out and prioritised to those who have suffered the most?
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill — House of Commons, 2021-09-22
Topic: Mixed Topics
Guy Thomas Opperman (Conservative, Centre-right): It is an honour and privilege to respond at Report of this important Bill, which deals with the compensation due to many of our constituents up and down the country. I pass on apologies from the Economic Secretary to the Treasury who is on a ministerial trip to the United States on behalf of Her Majesty’s Government As the House will be aware, Dame Elizabeth Gloster’s report has already been taken through. It is a detailed report that deals with the regulatory failures that led to the collapse of LCF. The Government have accepted all four of the Gloster recommendations, and the FCA has committed to implementing all nine of the recommendations that were addressed to it, and to report publicly on the progress of those vital reforms Progress has already been made in implementing those recommendations. For example, the Treasury has consulted on proposals to regulate so-called non-transferable debt securities. In respect of regular reporting, hon. Members should be aware that the FCA report on the transformation programme takes place every six months. Its last report took place in July 2021, and the next report will be in spring next year Colleagues have raised a number of different matters, and I will attempt briefly to deal with them. The hon. Member for Harrow West (Gareth Thomas) recommended to Treasury colleagues that parliamentarians should hold the FCA to account directly, and I am sure my Treasury colleagues will respond to that proposal by letter. My hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) made some comments, and it is right that the FCA needs to be more proactive. To be fair, its new chief executive, with whom I know my hon. Friend is familiar, is being more proactive, and there is proper oversight on an ongoing basis. Several colleagues mentioned the online harms Bill. I have engaged with and met Google, Facebook, LinkedIn, and Instagram, as have colleagues from other parts of Government. Those individual companies need to step up to the plate, because it is very much in their domain to make real change.
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill — House of Commons, 2021-09-22
Topic: Mixed Topics
Atta-Ur-Rehman Chishti (Conservative, Centre-right): I am grateful to the Minister for allowing me briefly to intervene. He said he has had conversations with those social media companies. I sat on the Home Affairs Committee when we discussed online harms. What was the response of those social media companies, and what will it take to get them to do the right thing?
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill — House of Commons, 2021-09-22
Topic: Domestic Commerce
Guy Thomas Opperman (Conservative, Centre-right): It will take strong pressure by fantastically good constituency MPs such as my hon. Friend, and others, so that those companies realise that they have an obligation to do the right thing in respect of the many constituents we represent. Clearly, though, these are matters to be considered by the Government, and I am sure my hon. Friend will be making representations to the Secretary of State for Digital, Culture, Media and Sport Let me turn briefly to the amendment. A lot of the speeches made had nothing to do with the amendment, and it is important to avoid creating the misconception that the Government will stand behind all bad investments in the future, where FSCS protection does not apply. The Government will establish a scheme based on the level of FSCS compensation, capped at £85,000. We have carefully considered the issues and are satisfied that the individual circumstances surrounding LCF are completely unique. Other mini-bond firms have failed, but LCF is the only mini-bond firm that was authorised by the FCA and sold bonds in order to on-lend to other companies. As the House will know, only three Government compensation schemes have been established in the past three decades, for Barlow Clowes, Equitable Life, and now LCF, despite many firms failing over that period. This type of intervention is the exception, not the rule Although the amendment is legitimate and considered to be principled and practical, there is a practical reality that the FCA is already reporting and is held to account by the Treasury. With respect, I therefore ask the hon. Member for Glenrothes (Peter Grant) to withdraw his amendment Question put, That the amendment be made,
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill — House of Commons, 2021-09-22
Topic: Domestic Commerce
Kevin Paul Hollinrake (Conservative, Centre-right): The Treasury deserves great credit for introducing this compensation scheme in the first place. It is a pity that the Minister responsible—my hon. Friend the Economic Secretary—is not on duty today, because he deserves personal credit for that, but the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Hexham (Guy Opperman) is an excellent stand-in Warren Buffett once said that what we learn from history is that we do not learn from history. The key lesson that we have to learn from this sorry episode—a damning assessment of the Financial Conduct Authority’s capability as a regulator at the time—is the need for scrutiny of the regulator. As many Members know, I do quite a lot of work trying to hold banks to account in the all-party parliamentary group on fair business banking, but I still do not know how this place holds the regulator to account. I know that the Treasury has some direct influence, and the Treasury Committee can write reports and conduct inquiries, but I still do not know of a direct mechanism that can be used by this House to address regulation and regulations Now that we have repatriated the oversight function from the European Union, various different suggestions have been made as to how that might happen in this House. One of the most interesting proposals is for something along the lines of the Public Accounts Committee—a regulatory accounts committee, supported by a version of the National Audit Office, so that professionals would sit behind a parliamentary committee made up of elected parliamentarians. Whoever holds the regulator to account should be accountable to the public; they should not be an independent body of appointees. There must be a mechanism to make sure that the regulator does the right thing, makes good on its future commitments and ensures that episodes like this do not happen again The Gloster report, which led to the compensation scheme that we are putting in place today, made very damning criticisms of the then governor of the FCA, Andrew Bailey, who is now the Governor of the Bank of England. I have experience of dealing with the FCA and Andrew Bailey—I asked him four times whether he had followed the FCA’s own whistleblowing procedures when handling the case of Sally Masterton’s whistleblower complaint with HBOS Reading and Lloyds. He refused to answer that question, which I find horrendous. Both the FCA and the whistleblowing legislation were established by statute, yet we as parliamentarians cannot hold the regulator—which we put in place—to account. We need a better system of regulatory oversight.
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill — House of Commons, 2021-09-22
Topic: Domestic Commerce
Sally-Ann Hart (Conservative, Centre-right): Residents in Hastings and Rye have been victims of London Capital & Finance. Does my hon. Friend agree that if people do something in good faith, get the right advice and the right system is in place, there should be measures in place to ensure that they do not end up on the back foot?
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill — House of Commons, 2021-09-22
Topic: Domestic Commerce
Kevin Paul Hollinrake (Conservative, Centre-right): As I said on Report, it is incumbent on investors to check out investments. If something is paying out 8% when they can get 0.5% from their bank, they must say, "Well, this is more risky than simply putting it in the bank." We cannot lose sight of that principle. However, the least we can expect is a regulator that is proactive. In 2015, a number of people were raising concerns about LC&F, including an independent financial adviser who wrote in detail to the FCA to say what was happening at LC&F, but the FCA did nothing for four years, which is totally unacceptable. People deserve a higher standard of regulation On the Online Safety Bill, London Capital & Finance spent £20 million on Google advertising. It is clear that platforms are playing a role in this. This was not even seen as a scam. We can argue that it was a scam, but it was to some extent regulated by the FCA. UK Finance has released a report today saying that online scams are now a national security risk. We must take seriously its calls for more action to be taken. The Online Safety Bill must be the right place to legislate to require the platforms to at least establish whether the investment companies—the people who are advertising investments—are bona fide organisations, and not simply people impersonating them With that, I will conclude. I am keen to hear the Minister’s words in his summing up.
Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill — House of Commons, 2021-09-22
Topic: Domestic Commerce
James Nelson Grundy (Conservative, Centre-right): I am pleased that the Government have offered compensation to investors who fell victim to the collapse of London Capital & Finance. Many are set to lose significant sums through no fault of their own, having invested in a Financial Conduct Authority approved company and followed advice from London Capital & Finance that the Government and Dame Gloster concluded was misleading. A number of my constituents fall into that category and they have asked that I speak for them today The Government have acknowledged that the situation regarding London Capital & Finance is unique and exceptional. As such, the Government stepped in to create a compensation package on a one-off basis. Bondholders invested in what they believed was a regulated and approved company, which of course it was, and the Government expect to pay out significant sums to those affected and eligible. I welcome that. The group of women I met in my constituency who are affected by this issue are not millionaires, and nor were they trying to make a quick buck by investing in risky, speculative finance. These are ordinary people who invested their hard-earned savings in what they believed to be a solid, officially approved and properly regulated product Bondholders have been badly let down by London Capital & Finance, but they have also been let down by the regulatory system that was designed to protect them. The independent investigation led by Dame Elizabeth Gloster, which the Government published at the end of last year, concluded that the Financial Conduct Authority did not discharge its functions in respect of London Capital & Finance in a manner which enabled it to effectively fulfil its statutory objectives during the relevant period. Due to the Financial Conduct Authority’s significant regulatory failure, there is a case to be made that the Government scheme ought to provide the same level of compensation as the Financial Services Compensation Scheme, namely 100% of loss capped at £85,000 instead of the current £68,000. Finally, I would be grateful if my hon. Friend the Minister would write to me to clarify when the Treasury will release details of the timescale of the compensation process, so I can pass that on to my affected constituents. I hope the Government will give due consideration to the points I have raised in today’s debate.
Subsidy Control Bill — House of Commons, 2021-09-22
Topic: Mixed Topics
Kwasi Alfred Addo Kwarteng (Conservative, Centre-right): In her brief time in the House, my hon. Friend has been an impressive and focused campaigner on behalf of her constituents and the wider industry. As she knows, I am a particular fan of the steel industry, and want to seek a sustainable future for it here in the UK. I cannot give any budgetary guarantees, as she will appreciate, but this system does give us much more flexibility than was the case previously.
Subsidy Control Bill — House of Commons, 2021-09-22
Topic: Mixed Topics
Daniel Robert Kawczynski (Conservative, Centre-right): As somebody who has represented a border constituency for the past 16 years, I have become increasingly concerned about the additional levels of subsidy that the Welsh Government can give to businesses on the border, putting our Shropshire businesses at a disadvantage. Will the Secretary of State address that point, please?
Subsidy Control Bill — House of Commons, 2021-09-22
Topic: Domestic Commerce
John David Penrose (Conservative, Centre-right): My hon. Friend makes an important point. Indeed, he has led me to the final point in my speech. He is right to say—I know Ministers in the Department have this instinctively in the marrow of their bones—that we must not turn this into some bureaucratic red tape burden. Indeed, one chapter in the report that I was asked to write about competition policy refers to reducing red tape burdens. We all understand that too much of that will slow down even the best company and reduce its competitiveness compared with companies in other countries, so he is right to be concerned In this case, however, doing what I suggest should reduce the red tape burden rather than add to it. That is because one of the other exemptions, which I think is £325,000, is for a cumulative set of subsidies. If I have three or four subsidies granted by three or four different local councils, or perhaps by a devolved Government and some local councils, and they cumulatively add up to £325,000 over a three-year period, that has to be declared and everyone has to keep track of that. Under the existing Bill, individual councils making those grants will not be keeping that record. They will not be able to, because they will not know what the other councils have done. The companies that are getting those grants will have to keep their own records for three years. That is a business burden that we will create if we do not change the Bill right now. If we just said instead, "There’s one central public database and everything gets put on it; no company has to keep any records whatsoever because it’s all out there and it’s visible, searchable, clear and transparent," there would be no extra business burden at all and, as my hon. Friend the Member for Thirsk and Malton just pointed out, there would be minimal extra public burden, because the local councils, devolved Administrations and Government Departments keep these records anyway. All they would have to do is extend the print range on their spreadsheets slightly further down the page, or organise their automatic file uploads a little more simply, so the burden would be minimal. If we did it that way round rather than what is currently in the Bill, we would avoid creating a new red tape burden With that, I will do something unusual for a politician and shut up. This is a good Bill, it is an essential Bill, and it does some really important things. I am really pleased to see it come forward. My right hon. Friend the Secretary of State is doing precisely the right thing, in the right way. We have one concern about detail; with any luck, I am sure that can be ironed out.
Subsidy Control Bill — House of Commons, 2021-09-22
Topic: Domestic Commerce
Kevin Paul Hollinrake (Conservative, Centre-right): It is a pleasure to speak in this debate and to listen to the various arguments on both sides of the House I am a committed free marketeer and have been in business for most of my life, and I do not think that I have ever accepted a Government subsidy—other than perhaps last year under the coronavirus business interruption loan scheme. I would be interested if the Minister could reflect on whether that would qualify under this legislation. I do not really believe in subsidies, but a world without subsidies requires a perfect free market and we do not have a perfect free market. We do not have the perfect consumer, the perfect market competition or the perfect provision of small and medium-sized enterprise finance. At times, a Government absolutely need to step in and provide subsidies where there is market failure, so I welcome this legislation and the vast majority of its provisions.