Coronavirus to mean both bust and boom for unregulated investments

Last year I counted over £1 billion in losses from unregulated investments marketed in the UK that went bust in 2019.

And the scary thing is that this was without a global financial crash.

Some unregulated investments hilariously put the blame on Brexit despite their assets being outside the UK – which meant Brexit should have made it easier to repay their Sterling-denominated debts with their overseas earnings.

The sad reality is that one of the consequences of coronavirus is likely to be a spate of further collapses in the unregulated investment world, as new investment dries up and already-shaky schemes exploit Covid as the perfect excuse to shutter their windows and disappear with what’s left.

The only question is whether 2019 was already the storm or just the canary in the coalmine.

It is also possible we may see schemes play for time by suspending withdrawals but dangling the carrot of future resumption. With the courts currently paralysed by lockdown, it will take a while for any disgruntled investors to enforce their debt (which always takes a long time anyway).

And while coronavirus may sound the death knell for old schemes, it will also be the starting gun for the next wave. Life goes on and there will still be a steady stream of inexperienced investors with windfalls to invest – such as pension lump sums, inheritances, and insurance payouts.

They are currently being told by all and sundry – including the mainstream media – that mainstream investments are scary and lost hundreds of billions during the corona crash (losses that don’t actually exist except for people foolish or imprudent enough to cash in at the bottom of the market). There will also be those who cashed in their pensions or investments in the stampede, and are now looking for some kind of magic solution to recover their self-inflicted losses. They are all being lined up for the wolves.

The only question left is to see what people come up with as the new magic “coronavirus-proof” “assured” “uncorrelated to the stockmarket” that delivers 8% per year, year in year out. In the early 2010s it was carbon credits, in the mid-2010s it was property development, in the Roaring Twenties it will be… answers on a postcard, or a Google ad.

We have seen it all before. Yet the UK Government, despite having recently proven itself capable of shutting down the entire country and all social contact at the drop of a pin, continues to refuse to take the simple, practical and already tried-and-tested measures that would significantly reduce losses to unregulated investments.

The indefatigable Mark Taber has already reported on some of the more blatant scammers exploting coronavirus in their advertising (from which Google continues to rake money with no noticeable compunction), as have Professional Adviser and the Mirror.

12 thoughts on “Coronavirus to mean both bust and boom for unregulated investments

  1. Your forum is unregulated.

    This is comical. You are now criticising investment products that have NOT or may not even be launched.

    You harp on about this forum being about facts…is your article above face or your opinion?

    A new low for you!!

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  2. And the FCA look on with eyes closed and not a care in world what is going on around them? Shame on you.

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  3. I’m so glad you are finally being found out for the rubbish you speak.

    I’ve lost over £50,000 in my pension in the last couple months. Guess what that was a “legitimate investment” with a well known provider.
    I have a very dear friend who has one of your previously quoted dodgy investments and they have consistently earned a great rate and in fact been returned her capital. YOU made me invest another portion of my capital in this well known provider, why did I listen to you

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  4. I’ve lost over £50,000 in my pension in the last couple months. Guess what that was a “legitimate investment” with a well known provider.

    If it was a sensibly diversified, non-geared investment, you’ve lost nothing unless you panic and cash it in. Short-term market falls like this one are normal, just as they were normal in 2008 and normal in 2000. The cost of higher returns than cash in the long term is putting up with temporary paper losses in the short term.

    I have a very dear friend who has one of your previously quoted dodgy investments and they have consistently earned a great rate and in fact been returned her capital.

    And I’ve got a friend who’s going to retire to her 40-foot gold catamaran when OneCoin comes good. Name the investment so we can have a look at its accounts and past performance, or we’ll have to assume you’re talking out of your hat.

    YOU made me invest another portion of my capital in this well known provider, why did I listen to you

    As I’ve never recommended any mainstream providers via this organ, you haven’t.

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  5. “Short-term market falls like this one are normal, just as they were normal in 2008 and normal in 2000.”

    Brev, I’ve stayed quite long enough but you have no credibility any more. Let me first give you the definition of normal: “the usual, typical, or expected state or condition.”

    Is it the “Usual” or “Normal” for the market to drop 9% in the UK in one day? Is it normal for the biggest company on the FTSE 100 to drop 15% in a day? No! So do not mislead AGAIN and say it is normal.

    This stock market fall we are witnessing is NOT NORMAL.

    2008 market crash was NOT NORMAL.

    2000 Dot Com bubble and subsequent market crash was NOT NORMAL.

    You are misleading everyone now. This has to stop.

    “Short-term market falls like this one are normal” . Short term. What are you talking about brev. In 2007 Lloyds share price was 358p, 13 years on its 30p. How short term are you talking?

    [BrevEdit – Off-topic conspiracy theories removed.]

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  6. 2020 was not normal. 2009 was not normal. 2000 was not normal. 1998 was not normal. 1997 was also not normal. 1992 was not normal. 1987 was not normal. Right you are…

    The markets dropped 20% in a day in 1987 and that was from much lower levels than they are now, and without fibre-optic-powered high frequency trading bots.

    There is no magic investment that returns higher than cash without risk of occasional paper losses.

    If you want to discuss individual shares then Motley Fool is that way. We are talking about diversified investments. It is normal and expected for individual shares to drop by 100% in a day, no matter how famous – see Carillion or Enron.

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  7. Wow! Some incredibly misinformed posts here and none of them from Brev. Looks like the unregulated scammers are posting in force. It is normal for stock markets to drop large amounts at a time, 2020 is no different to previous occasions. The reason may be different but the market reaction isn’t. Good luck with any unregulated investments, I’m sure if you ask the Blackmore Bond and LCF bondholders how it’s going with getting their money back they’ll give some choice words.

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  8. I almost feel proud that someone used my name to slag off Brev. However, it was probably a dim-witted employee of a fraud CBD investment firm so not that proud really.
    Someone appears to have spoofed Stephen as well (if the profile icons are anything to go by).

    Personally I find this site excellent as it helps me map the network of shysters and fraudsters I have been compiling.

    Liked by 1 person

  9. Thanks for pointing that out D. Email addresses also confirm that “Stephen” is not the regular Stephen (however I’m not going to police use of common first names so that post can remain up for everyone’s amusement).

    Liked by 1 person

  10. What is not normal is the continuous pumping of money in the system and the market manipulation in order for prices to keep on going up. And this process began in 2008, to avoid the financial crisis which naturally would have come and healed the system ,as it always did in the past. This coronavirus is a fake crisis, still manipulated, and an excuse to force central banks to print more money.
    This is scary, and what made me try the unregulated investments. But that did not work…
    Japan has been printing money since 2000 (but did not manipulate its stock market upwards) and nothing bad happened apparently, so now it seems that printing money is the way to go to solve problems.
    I really do not believe it, I think it is the way to self destruction.

    Like

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