Complaint about London Capital & Finance Bonds to Financial Conduct Authority (FCA) & Advertising Standards Authority (ASA)

After repeatedly seeing questions raised on Money Saving Expert about the London Capital & Finance bonds that purport to be low risk savings bond and is advertised on sites alongside cash accounts that are fully FSCS protected I reported these to the Advertising Standards Authority (ASA) and Financial Conduct Authority FCA.

The advert details make no mention of the fact these are completely unregulated and you could lose ALL your money. The full asset backed security is nonsense and misleading investors into thinking there is protection to their savings when they could lose their entire investment.

I have posted risk warnings about London Capital & Finance bonds before but need to report them too so hopefully people won't get sucked in and lose money they can't afford too. It's criminal that a company is allowed to promote their products in such a way that they are made to appear low risk when a regulated product could not do so.

On regulated investments you have specific warnings that have to be given like here. Key ones such as 

• Unlike cash, stock market based investments are not guaranteed and fall in value as well as rise, we therefore believe you should only invest for the long term (5+ years). Ultimately you could get back less than you invest. Any yields will vary over time so income is variable and not guaranteed.

I'm pretty sure that many people investing in LCF bonds will do so because they consider the stock market too risky. Incredibly frustrating that LCF bonds are off the scale in risk compared to normal stock market funds and so are actually far less risky because they are regulated and protected by FSCS unlike LCF.

LCF complaint to FCA

Complaint about London Capital & Finance to FCA &ASA

The complaints were submitted this month (March 2017). ASA replied that the adverts were outside their remit and they would pass them on to the FCA. Other MSE forum members have also reported them to FCA.

The reply from ASA is below:

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Thank you for contacting the Advertising Standards Authority (ASA) with your complaint about LCF.

Our Remit

The material you complained about is not covered by the Advertising Rules because aspects of non-broadcast advertising for most financial ads are subject to statutory control by the Financial Conduct Authority (FCA) For these reasons, we have not assessed the content and we will not be taking your complaint further.

What Happens Next?

We have passed your complaint about this promotion to the FCA; however, please note that they do not report their findings or contact consumers directly, but please rest assured that they will take any necessary action. I have attached a copy of the referral acknowledgement which gives more information; you might also find their website useful.

You may be interested to know that the ASA does have the power to investigate complaints about financial advertising on radio and TV (we also investigate non-technical aspects, such as offence, in advertising in any medium). 

Thank you for taking the time to share your concerns.