Supreme Court Decision on Car Finance Welcomed

The Supreme Court (the Highest UK Court) has issued a decision on some of the claims where it is alleged that car finance and insurance was mis-sold. The claims were mainly based on the fact that those who purchased cars from dealers were not advised of the amount of commission they were paying to arrange it. The car dealers were simply taking the opportunity to sell an additional service to the car purchaser (the buyer did not have to take it as they could have arranged finance and insurance elsewhere).

The claims were potentially going to amount to billions of pounds and would have been very damaging to major insurance companies. I welcome the Supreme Court decision and I actually said this in a previous blog post: “It is surely daft that customers who bought insurance with their eyes wide open should be able to claim anything. They presumably were happy with the costs and level of cover, so the fact there were undisclosed commissions is irrelevant”.

One commentator on that blog post suggested that the car dealer was acting as an agent for the car owner so had a fiduciary duty to advise the owner of the terms of the deal and the commission being paid. But the Supreme Court said no fiduciary duty was owed which hopefully kills off most of the dubious legal claims.

Unfortunately the Court decision is not quite as clear cut as it might appear and there might still be room for some claimants to pursue their cases. Claims management companies were actively pursuing the recruitment of millions of claimants and some appear to be still doing so.

It is surely time for the Financial Conduct Authority (FCA) to kill off any suggestions of a “redress scheme” in this case and to clarify the legal position going forward – by new legislation if necessary.

In general the Courts should not be inventing new legal principles or protecting the ignorant against their own mistakes retrospectively.

Roger Lawson (Twitter: https://x.com/RogerWLawson  )

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Blocking Porn and the Use of VPNs

The Online Safety Act now requires digital platforms to verify the ages of their customers. The intention is to block minors from accessing pornography. But the use of Virtual Private Networks (VPNs) is a simple way around the issue that can be used by anyone with some basic knowledge.

Now I do have a VPN product on my laptop which was installed years ago. This was a product supplied by Norton as a package with other software security products. This was obtained to protect me from security issues when using public internet networks in hotels or elsewhere. It enables me to pretend to be in another country for example and can hide my IP address.

Does that mean that age verification systems used by porn sites can be bypassed? Yes it does from my simple tests. That might explain why the number of downloads of VPNs has rocketed of late. But apparently there are potential risks with some VPNs.

To quote from a recent British Computer Society newsletter: “Daniel Card, a BCS member with significant expertise in cyber security, spoke to BBC News about the hidden risks: He said: Many of these free VPNs are riddled with issues. Some act as traffic brokers for data harvesting firms, others are so poorly built they expose users to attacks.”

I think the message is if you are going to use a VPN then acquire it from a reputable provider and expect to pay a small fee for it.

The OnLine Safety Act has been criticised for other reasons – see https://consoc.org.uk/the-online-safety-act-privacy-threats-and-free-speech-risks/. It will certainly not prove effective in blocking access to pornography and even Apple have complained that their security systems may have to be relaxed to meet Government requirements for access to encrypted data – see this BBC report: https://www.bbc.co.uk/news/articles/cgj54eq4vejo

It appears the legislation may have been invented by lawyers with little knowledge of the technical environment.

Roger Lawson (Twitter: https://x.com/RogerWLawson  )

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Maven Renovar VCT (MRV) – Requisition and Voting

As previously noted, the Maven Renovar VCT has received a requisition from Paul Jourdan, the former manager, to replace the board – see https://www.investegate.co.uk/announcement/rns/maven-renovar-vct-plc–mrv/receipt-of-requisition-request/8955955 .

It seems to have gone very quiet since that announcement. Is the result a foregone conclusion or is there going to be a proxy battle as usually happens in such circumstances?

Here are my comments in case you have not yet voted on the resolutions:

As a long-standing shareholder in the Amati AIM VCTs I welcomed the change of fund manager to Maven because the performance of the Amati AIM VCT has been dire in terms of total return. I hold a number of VCTs (including some Maven ones) and the Amati managed one has been one of the worst in terms of performance. I would have sold my holding long ago if I had not been hampered by originally claiming capital gains rollover relief.

The prospect of Paul Jourdan continuing to be involved in the management of the company does not bode well in my view. We need to support the new board and Maven and let them get on with the job without the distractions of fending off general meeting requisitions.

I and my wife have therefore voted as per the recommendations of the current board.

Roger Lawson (Twitter: https://x.com/RogerWLawson  )

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Paul Scott Rants on Digital Currencies and Meme Stocks

I follow Paul Scott’s blog which generally covers small cap stocks but he also covers other stock market matters. Today he gave his views on Bitcoin, other digital currencies and “meme” stocks which are being ramped up again in the USA. He concludes that they are all simple speculations.

Today as it’s Friday his blog is free – see: https://paulypilot.substack.com/p/pauls-daily-podcast-free-friday-25

I agree totally with what he says.

His blog is usually both accurate and amusing and is highly recommended.

Roger Lawson (Twitter: https://x.com/RogerWLawson  )

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Digitised Share Registers and surrounding myths

The Investors Chronicle have reported that the Government has announced its intention to accept the recommendation of the Digitisation Task Force to proceed to a staged transition to remove paper share certificates. To quote: “The first stage of this process will see existing paper share registers replaced with digitised versions, which should be completed by the end of 2027”.

It astonishes me that there are any paper share registers still in use. Are there companies really still using leather bound paper share ledgers to track their shareholders? Surely most are now at least using spreadsheets to record their shareholders.

For publicly listed companies (which is all we are concerned with) they are typically using a few professional registrars who all have digital systems. So setting an end-date for completion of this step of 2027 is surely quite ridiculous and shows how little knowledge there is of the work required to remove paper share certificates.   

P.S. Some people think that the fact you are holding a paper share certificate is indisputable evidence that you own the shares. This is mistaken. The ownership is confirmed by an entry in the company’s share register alone.                                                                           

Roger Lawson (Twitter: https://x.com/RogerWLawson  )

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Damning ShareSoc Press Release on Digitisation Report

ShareSoc have issued a press release on the Final Digitisation Report issued by Sir Douglas Flint. It is highly critical of some aspects of the report and quite rightly so. See https://www.sharesoc.org/sharesoc-news/digitisation-taskforce-report/

Mark Northway, ShareSoc Policy Director, included these comments in the press release: “It fails to protect key shareholder rights and introduces dangerous financial incentives which will further erode investor engagement.

It is particularly disappointing that the taskforce has chosen to prevent investors from leveraging digital technology to communicate between themselves by email. Without the threat of shareholder activism, many of the corporate governance improvements of the past twenty years would not have happened.”

If the Flint report is adopted without major changes it will set back shareholder representation by many years.

Roger Lawson (Twitter: https://x.com/RogerWLawson  )

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Dematerialisation and the Digitisation Taskforce Final Report

The scrapping of paper share certificates for listed companies has been planned for many years. It is something I have strongly supported for 25 years although this is a complex area and it is important to protect shareholder rights during this transition. You can read more about the issues on this Sharesoc web page: https://www.sharesoc.org/campaigns/shareholder-rights-campaign/

The interim report and consultation from the Digitisation TaskForce showed strong support for this move – to quote: “almost universal support for the removal of paper shares”.

Another need is for the removal of the need to pay dividends via cheque – they should all be paid by bank transfer – a safer and more secure system. Despite the fact that I personally only have paper share certificates for a few private companies (which it is not proposed to change) and most of my holdings are either in ISAs, in Crest accounts or other broker nominee accounts, I still receive a few dividend cheques. This can make it horribly complicated to identify and trace all dividends.

The Final Digitisation Report covers some of the technical issues that need to be dealt with in the conversion. There are still many people holding paper share certificates in listed companies (over a million I understand)  often as a result of privatisation events or new issues such as in VCTs.

Companies (i.e. “Issuers”) also wish to improve their communications with the beneficial owners of their shares which at present can be very haphazard – companies do not know who owns their shares which is a major defect.

The Final Digitisation Report comprehensively covers the issues and I won’t even attempt to cover it in detail. But certainly it is worth reading – see https://www.gov.uk/government/publications/digitisation-taskforce-july-2025 . There are few points worth highlighting:

  1. Should it be done in a “big bang” for all issuers or a gradual process over some time? If KYC checks are necessary then it is going to be practically difficult particularly as many certificated shareholders may have lost their certificates. It could take years to complete the process so surely the sooner it is started the better.
  • The Report makes a number of recommendations regarding the transition including the “establishment of a Technical Group of relevant experts” which I agree with. There may be changes to legislation required (as in the Companies Act) so great care must be taken to ensure shareholder rights are not lost and any new systems operate smoothly. This cannot be rushed but it does need to be progressed without delay.
  • Another recommendation is that all shares should transition into the intermediated securities chain, i.e. digitised registers should only be an intermediate step. This is a questionable step as it might frustrate public access to a list of all shareholders which needs to be retained in case of the need for access to highlight shareholder concerns. There is also a potential problem with the separation of legal ownership from the Ultimate Beneficial Owner (the individual shareholder), who under the proposed Model 3 would become reliant on the nominee who has the legal status (see Page 33 last paragraph).  This is a major issue which the Final Report has ducked.
  • There are recommendations to improve the legal standing of beneficial owners which is certainly required.
  • The Report also includes a “Bill of Shareholder Rights” (see page 24) which certainly covers the key requirements of most shareholders.
  • The Final Report does cover all the issues that need to be covered by a Technical Group but does not resolve them.

In summary, the Final Flint Report may note all the issues but does not clearly solve them.  

There does need to be back-up systems because relying on digital communications alone is risky. For example a fox chewed through our fibre internet cable at home this week. Our back-up BT 4G line did switch in but proved unreliable. Have these potential issues been taken into account?

Roger Lawson (Twitter: https://x.com/RogerWLawson  )

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Financial Advice – Does it Help? 

To follow on from my previous blog post, simplifying financial advice may help some people but one key question is: “Does financial advice actually improve wealth?”

The FCA attempted to answer that question in a Research Note – see https://www.fca.org.uk/publication/research-notes/bridging-advice-gap-estimating-relationship-between-financial-advice-wealth.pdf .

Here’s a key paragraph from the report: “Our findings suggest that financial advice positively supports wealth accumulation, especially in the initial years after advice is received. Our empirical findings reflect the qualitative insights from the literature which suggest financial advice helps consumers to avoid costly mistakes. Examples of these costly mistakes include inefficient tax planning, excessive cash holdings, or a non-diversified wealth portfolio. The short-term benefits of receiving advice could reflect consumers taking informed decisions that avoid these issues, providing an initial boost to wealth”.

One key message is that taking some financial advice is particularly worthwhile if you suddenly become richer.

Roger Lawson (Twitter: https://x.com/RogerWLawson  )

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Biggest Financial Advice Shake-up in More Than a Decade 

 I have just been reading an FT article with the above title. The FCA is to change the regulations about financial advice so that companies can give “targeted advice” but without getting into the costly need to give personalised advice by doing a full customer review. At least that is what I understand it to mean.

What’s wrong with the system at present? Those who most need such advice as they are financially ignorant tend not to get it because it is too expensive. The feeling is that many people are keeping too much cash in savings accounts rather than investing in stocks or bonds that would give better long-term returns.

Will this be a solution? Perhaps but it is not yet clear (to me at least) how this will work in practice and what exactly is “targeted advice”. The details of how this will work have yet to be disclosed.

I would suggest this is a poor solution to the problem. The better answer is to get folks more educated so they make the right choices when investing or saving. Education of the young in schools and colleges is not good enough so they fail to learn how to manage their own money well and how the financial world works.

Did the FCA actually consult those folks knowledgeable about financial matters rather than just those making money from retail investors? I do not recall any such consultations. This looks like an idea thought up by financial institutions to avoid giving personalised advice and will just be a cheap way around the problems that currently exist. It may protect those who currently provide advice from their responsibility to give appropriate advice but that is not what we need.

Roger Lawson (Twitter: https://x.com/RogerWLawson  )

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Rainbow Pedestrian Crossings – We Don’t Need Them!

 We all know what a zebra crossing is. It’s somewhere clearly marked (in black and white stripes on the road) as somewhere that pedestrians can cross a road in safety and where they have priority over vehicles.

The latest lunatic council to ignore this principle is the London borough of Camden who have painted a crossing in white, blue and pink at the junction of Tavistock Place and Marchmont Street (the transgender flag colours).

Other councils have similarly decided to undermine road safety by painting some crossings in non-standard colours to promote their favourite political or gender preference. But thankfully a Christian campaign group may be challenging this with a judicial review. See this note on Local Government Lawyer for the legal basis of the challenge: https://localgovernmentlawyer.co.uk/transport-and-highways/443-transport-and-highways-news/61503-london-borough-facing-judicial-review-threat-over-road-crossing-painted-in-colours-of-transgender-pride-flag .

Let us hope that this challenge is pursued. We have too much time and resources wasted on sexual politics already.

Roger Lawson (Twitter: https://x.com/RogerWLawson  )

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