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‘My abuser used our joint mortgage against me’

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'My abuser used our joint mortgage against me'
Getty Images Woman puts head in hands in despairGetty Images

Economic abuse can take many forms (picture posed by a model)

More than a decade after leaving her abusive ex-husband, Lauren is still trapped in their joint mortgage.

Her ex stopped making repayments, blocked attempts to sell or remortgage the property and withheld child maintenance.

Lauren, not her real name, told the BBC she and her children were left penniless.

It comes as a charity warns domestic abusers are using joint mortgages as a weapon. Meanwhile, the banking industry is working to break the cycle of economic abuse.

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A survey, published on Wednesday, of 1,000 women who held a joint mortgage in the last two years by charity Surviving Economic Abuse found one in eight experienced joint mortgage abuse.

The majority of those surveyed said the cost of living made their situation worse and the joint mortgage prevented them leaving their unsafe living arrangement.

‘Sickening’

Lauren told the BBC: “[The abuse] started with name-calling shortly after we moved in together then, after the birth of my oldest child, things turned physical.”

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Shortly after giving birth to their child, Lauren’s ex-husband tried to rape her and, on another occasion, he broke her wrist.

After he violently assaulted one of her children, Lauren decided to leave.

Throughout their marriage, her ex-husband had also exerted control over their family finances.

Economic abuse, which is recognised in the Domestic Violence Act, is estimated to occur in 95% of domestic abuse.

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And for many people like Lauren, it can continue long after a victim escapes their home.

Despite Lauren being awarded the house in the divorce, her abuser remains on their joint mortgage, and she told the BBC her ex had blocked attempts to sell and remortgage the property and racked up huge debts in their name.

It could have been different had Lauren been able to quickly sell the family home.

“It’s sickening. The sale of the house would have given us a secure and fresh start,” she said.

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Getty Images Pile of notes and coins and small wooden representations of houses.Getty Images

A survey of 1,000 women who held a joint mortgage in the last two years found one in eight experienced joint mortgage abuse.

Joint mortgages make buying a property easier, allowing people to borrow more money than on their own.

However, a joint mortgage can cause economic devastation if someone refuses to pay their agreed share, agree to new terms, or sell up. An abuser can continue to exert financial control.

A survey, published on Wednesday, of 1,000 women who held a joint mortgage in the last two years by charity Surviving Economic Abuse (SEA) found one in eight experienced joint mortgage abuse.

The majority of those surveyed said the cost of living made their situation worse and the joint mortgage prevented them leaving their unsafe living arrangement.

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The charity is calling on ministers to set up an urgent cross-government task force alongside the banking trade body, UK Finance, to better handle cases of mortgage-based abuse.

“Perpetrators can use joint liability to cause a lot of economic harm,” said Deirdre Cartwright, public affairs and policy manager at SEA.

Tackling it Together strap

How to protect yourself

Financial analyst Sarah Coles, from Hargreaves Lansdown, says anyone can become a victim. Her advice includes:

  • If you are in immediate danger, you should call the police on 999, and call your bank
  • Seek advice from specialist domestic violence organisations that can support you. The BBC’s Action Line has links to those who can help
  • As long as you are not in immediate danger, make sure you have copies of your financial documents
  • Try not to share passwords with partners to access financial information
  • Try to educate yourself as much as possible on your mortgage, insurance and all your finances, even if you are in a healthy relationship
  • If you can, try saving money of your own

Secret savings

A separate survey by the Building Societies Association (BSA) suggested many secret savers were setting money aside without telling a partner.

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Primarily, this was done to maintain a feeling of independence, but the next most popular reason was to use it as an escape fund.

However, there remain millions of people in the UK with little or no savings. The survey suggested women were almost twice as likely as men to have less than £100 put aside.

The financial sector has made progress in recent years to support those experiencing and fleeing from domestic violence.

TSB recently announced an Emergency Flee Fund, offering payments of up to £500. Starling Bank has also made progress in stopping abusers sending messages to their victims through payments.

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Many bank branches have safe spaces, where someone can speak privately.

However, joint mortgages, because of the contractual obligation to both parties, can be weaponised long after initial separation. Under current laws, any contractual changes require both parties’ consent.

Owning your own home with a partner also affects access to vital resources to help people leave an abuser and severely limits access to legal aid and representation.

In addition to bearing the brunt of joint mortgage payments, some also have to incur expensive legal fees during court proceedings.

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“Financial abuse is a horrendous crime,” said Fiona Turner, head of vulnerability policy at banking trade body UK Finance.

“We need a quicker route to getting debts and mortgages separated and getting parties delinked.”

Whatever the challenges, campaigners and survivors say economic abuse should not stop women leaving dangerous partners when their life and safety is at risk.

“There should be more understanding from lenders on mitigating circumstances,” said Ms Coles.

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“Leaving is not easy, but it is worth it.”

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Major airline reveals its new ‘cuddle cabins’ for passengers – with double beds, privacy doors and seat warmers

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Lufthansa has revealed its new first class cabins

AN airline has launched their new first class seats – and they’ve been dubbed ‘cuddle cabins’.

German flag carrier Lufthansa recently revealed its new cabin upgrades which included economy and business class.

Lufthansa has revealed its new first class cabins

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Lufthansa has revealed its new first class cabinsCredit: Lufthansa
The seats come with a two-person bench

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The seats come with a two-person benchCredit: Lufthansa

But also being rolled out on their A350-900s, aircraft are its new first class cabins.

Called the Allegris First Class suites, they have been designed by Lufthansa and London-based PriestmanGoode.

There are just three onboard; two for solo passengers and one for two travelling.

But don’t think you can flash the cash to make it on – the suites are currently invite-only.

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The two seats on the window sides of the cabin are for one passenger, while the internal “cuddle cabin” is for two passengers travelling together.

Passengers can either sit next to each other or opposite on the two bench seats, although it fits up to four passengers at a squeeze.

The seat then folds out into a 1.4 metre double bed.

Each one has private sliding doors and high walls so expect extreme privacy.

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Other extras include 4K inflight entertainment screens, wireless headphones and even a wardrobe.

If you’re often too cold on planes, there are even warming pads in the seats, similar to in a car.

European airline to launch ‘business class style’ economy seats without the cost

Passengers might be confused by the lack of overhead lockers, taken up by the high walls – with cabin bags being stored in the seats instead.

The first airline with the suites will be from Munich to Bangalore on November 9.

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While they are currently invite only, they will eventually be open to bookings when more are added to the A350s.

A price point has not been confirmed although the average price of first class flights according to Kayak is around £6,500 return.

The airline explained: “As soon as more aircraft with the new First Class are part of the fleet, targeted upgrades by passengers and later targeted bookings will be possible step by step.”

Lufthansa has some other snazzy upgrades coming to their flights, including the world’s first airline with VR headsets.

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They even come with private wardrobes and huge entertainment screens

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They even come with private wardrobes and huge entertainment screensCredit: Lufthansa
The benches fold out into double beds

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The benches fold out into double bedsCredit: Lufthansa

Business class suite passengers will be able to use it to watch films and play games.

The airline said it would “exclusively offer content such as captivating cinema-style movies, engaging VR 360-degree travel podcasts, interactive games and soothing relaxation exercises”.

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And business class style seats are being added to its premium economy.

The seats will have fold-out leg rests as well as extra legroom and hidden cocktail tables in the arms.

Even Lufthansa’s overhead lockers are getting a makeover.

The airline will be the first to roll out the new style of L bins which will allow more luggage onboard.

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Full list of The Sun’s airline reviews

Rather than stacking bags on their backs, suitcases will be put in on their sides, fitting up to three extra bags per locker.

Launching on January 2025, other airlines including Iberia and British Airways are also set to introduce them.

The cabins are currently invite only

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The cabins are currently invite onlyCredit: Lufthansa

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Why the Tories stay ahead on political firsts

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This article is an on-site version of our Inside Politics newsletter. Subscribers can sign up here to get the newsletter delivered every weekday. If you’re not a subscriber, you can still receive the newsletter free for 30 days

Good morning. I’m afraid I have to kick off with one of those slightly awkward peeks behind the curtain: I had assumed that today’s newsletter would be about the new leader of the opposition and their early key appointments to their new shadow cabinet. After both of the past two times a leader of the opposition was elected on a Saturday morning — Keir Starmer in 2020 and Jeremy Corbyn in 2015 — this procedure was followed.

Newly elected Tory leader Kemi Badenoch, who won 57 per cent of the vote to beat Robert Jenrick, has not appointed anyone to her shadow cabinet other than her new chief whip, Rebecca Harris, and joint Tory party chairs Nigel Huddleston and Dominic Johnson. I think this is a mistake, and not just for self-interested reasons.

Our new leader of the opposition has to populate a front bench from just 113 MPs, once you take away the select committee chairs, and those who have ruled themselves out, as James Cleverly did in this week’s Lunch with the FT. When you are appointing a shadow cabinet, particularly when you are drawing on the smallest talent pool in modern times, you are essentially having to bounce at least some people into taking unpaid jobs they don’t really want to have.

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Some luckless MP without any real connection to Wales is going to have to spend half an hour every month being patronised by the secretary of state for Wales. Some close ally of Badenoch will have to eat a job they do not much care for in order to keep the party together, and so on.

It also means giving up really the only day this week that she is likely to command any attention at all, given the fact the US presidential election is taking place tomorrow.

That said, given that one of the two candidates in that contest has promised to enact a series of world-shaking tariffs that would hurt Americans, Britons, essentially everyone in the world, it may well be that Badenoch is likely to be the next prime minister, regardless of her decisions over the next few weeks.

As such (and not just because I am down a newsletter topic) it seems to be a good opportunity to revisit an article I wrote four years ago about why the first black British prime minister would probably be a) a Conservative and b) a black British African.

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Inside Politics is edited by Georgina Quach. Read the previous edition of the newsletter here. Please send gossip, thoughts and feedback to insidepolitics@ft.com

Points of difference

All stories are ultimately about management, other than the ones that are about commodities. That was my underlying theory in 2020 at any rate when I sought to explain the Tory party’s remarkable near-monopoly of political firsts:

The first ethnic minority prime minister in Benjamin Disraeli; the first female prime minister in Margaret Thatcher; the first British Asian to run for the role of prime minister in Sajid Javid, who also became the first British Asian to occupy the roles of chancellor and home secretary; the first Muslim to attend cabinet in Sayeeda Warsi; the first Asian-British woman to be home secretary in Priti Patel; the first ethnic minority to serve as chair of either main party in James Cleverly.

I don’t think this can be explained with reference to the Conservative party’s views “about diversity”: within that list of firsts alone you have an awful lot of different views about diversity. There isn’t really a single Conservative party view about diversity. No, I thought at the time that pretty much all of the Conservative party’s success could be explained through its institutional health:

The reason the Conservative party has been more successful at hitting these historical firsts is because it is more successful in general. From the party’s exit from the Liberal-Conservative coalition in 1922 until the rise of Tony Blair, every Conservative party leader also became prime minister. One reason to believe that the first Black British prime minister will be a Conservative is because the British prime minister is almost always a Conservative.

…Why the specificity of British and African? Well, because as the Runnymede Trust has shown, the Conservatives’ in-roads among Black voters are strongest among Black Brits whose parents or grandparents have come from Africa, as opposed to those whose parents or grandparents have come from the Caribbean, and your ability to recruit talent is inextricably tied to your appeal among that group. We can see this in the area where Labour has racked up many more firsts than the Conservatives – LGBT representation.

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Indeed, the 2024 Tory leadership contest offers one way for me to claim validation. Whether the Tory party chose the candidate whom Labour and the Liberal Democrats most feared (James Cleverly), or went for one of the “we lost because we weren’t rightwing enough, Partygate was no big deal, who is to say if we should charge for the NHS or not” options (Kemi Badenoch), it was going to be able to choose an ethnic minority.

So I think this analysis has held up, broadly speaking, but I missed an important aspect of the Conservative party’s success. Not only has the Conservative party been more successful, it has a rule book that makes it easier to change leaders and be adaptable.

In the 59 years since it became illegal to discriminate in the workplace on the grounds of race — thanks in no small part to Dr Paul Stephenson, who died this week aged 87 — the Conservative party has had 13 leadership contests. Labour has had nine.

That is partly about the Tory party’s greater institutional health — it is much easier to get rid of an underperforming Conservative leader than an underperforming Labour one — but it is also a function of its dysfunction.

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It has become fashionable in the Conservative party to deplore its ability to get rid of its leaders, saying it has tipped too far from being a useful advantage over Labour to a cause of internal division. Rightly or wrongly the Tories have altered the rules to make it harder, though the rule change seems like the worst of all possible worlds. The threshold was raised from 15 per cent to a third of the parliamentary party, meaning just 41 MPs could trigger a confidence vote in Kemi Badenoch. But if or when the party is back in office again it would need a third of MPs to initiate a contest.

It may be that Badenoch, the product of the Tory party’s institutional health, may well find that she leads it in a period of greater institutional dysfunction than any of her predecessors.

Now try this

It was my partner’s birthday last month, so I got her the new box set of the complete Homicide: Life on the Streets (I also got her some other gifts that were not things I would also enjoy, to be clear). It really is a terrific, terrific piece of television with an astonishing cast.

Top stories today

  • Stark message sparks backlash | Rachel Reeves has suggested UK businesses can “absorb” her increases to employer national insurance contributions by accepting reduced profits or making efficiencies, rather than passing on lower wage rises to workers.

  • Double funding | The UK will announce an additional £75mn for its Border Security Command in its plan to “smash” people-smuggling gangs. Yvette Cooper said the additional funding (bringing the total budget to £150mn) would be used for special investigators and new technology. “We are working very closely with Germany on how we substantially upgrade the actions on supply chains,” she told the BBC, adding that there would be an update on their joint work before Christmas.

  • Soaring costs | Work to make England’s multistorey residential buildings safe from dangerous cladding could cost up to £22.4bn, the UK’s spending watchdog has revealed.

  • Parker’s vision | West Midlands Labour mayor Richard Parker will become the first mayor to benefit next year from a “trailblazing devolution deal”. The former PwC partner tells the FT about his ambitions to reinvigorate the area and support the bankrupt Labour-run Birmingham city council.

  • ‘Blind spot in No 10’ | Senior Labour MPs have expressed their frustration at the lack of Black representation in No 10 as the Conservatives elected Kemi Badenoch as their new leader, according to messages leaked to the Guardian’s Jessica Elgot and Rowena Mason. One senior Labour frontbencher said it was a “serious embarrassment and a blind spot in No 10” that there were no senior Black staff members at the centre of a Labour government.

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Fitch reaffirms Sirius’s BBB rating with ‘stable outlook’

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Fitch reaffirms Sirius’s BBB rating with ‘stable outlook’

The ratings firm highlighted the high-yielding nature of the company’s assets, its resilient occupancy and rental growth due to active asset management and the affordability of its rents.

 

The post Fitch reaffirms Sirius’s BBB rating with ‘stable outlook’ appeared first on Property Week.

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What to look for on US election night

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Election day is on Tuesday but Americans might have to wait longer to learn who their next president will be.

The timing of a Kamala Harris or Donald Trump victory depends on two factors: how fast states count their ballots and how close the results are. Each state has its own rules for processing and counting ballots.

As polls close across the country — first on the east coast — and results start to come in, news agencies and broadcasters will project the winner of each state and the District of Columbia at the presidential level, as well as races for the US Senate and House of Representatives. The Financial Times will report results based on calls from the Associated Press.

The most important number of election night is 270, the electoral college votes needed to clinch the presidency. Expect a long night on Tuesday.

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Will we know the winner on the night?

This is unlikely.

Polling suggests the results in battleground states will be close, meaning it could take days for a winner to be declared. Some states are also slower to count ballots than others.

An additional complication could be any legal challenges to a state’s results, which could drag out the declaration of a winner. The Trump campaign and its allies have already started to cast doubt on the integrity of the election.

The Harris campaign has predicted Trump will declare victory before the presidential race has been called.

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The first polls close on election day at 6pm eastern time in some counties in Indiana and Kentucky, with the last polls closing at midnight ET in Alaska.

If swing states move quickly to count and the vote is not as close as polls predict, the result could be clear on Tuesday night. However, electoral experts and state officials predicted it was more likely to come on Wednesday morning. In some cases it can take days or even weeks to finalise results as absentee and postal ballots are counted, and occasionally recounted.

It is also likely there will be a wait to know which party will control each of the two chambers of Congress, the Senate and the House of Representatives.

There are four extremely competitive Senate races and 22 toss-up House races, according to the non-partisan Cook Political Report. The Senate map “very likely portents a [Republican] majority” while the battle for the House “remains as close as it’s ever been” wrote CPR’s Erin Covey.

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Which states are key to victory?

The most important states to watch are the seven battlegrounds: Arizona, Georgia, Michigan, Nevada, North Carolina, Pennsylvania and Wisconsin, which have a combined 93 electoral college votes.

Not every swing state needs to be called for a president to be named. Should Harris or Trump win the so-called blue wall states — Michigan, Pennsylvania and Wisconsin — and North Carolina overnight, for example, that would form a relatively quick path to 270.

North Carolina could be the first battleground to be called since most people vote in person and postal ballots must arrive by election day. A wild card issue this year is the impact of Hurricane Helene, which hit the state hard.

Georgia also counts quickly, but its razor-thin margin of 11,779 in 2020 led to a hand tally and the state was not called for Biden until more than two weeks after the election.

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Strength in the blue wall could indicate a candidate is doing well among working-class voters, while a win in Georgia could bode well for having won over Black voters.

Pennsylvania is slow because it cannot start counting postal ballots until election day. Wisconsin also cannot start counting postal ballots until election day, but officials expect a result on Wednesday morning since the tally must continue through the night. Michigan could move more quickly than before since more postal ballots can be processed before election day.

Arizona and Nevada are likely to be the slowest with results. Arizona officials have said it could take 10-13 days to report full results. In Nevada, a lot of people vote by post.

What happened in 2020?

Joe Biden was not declared the victor until Saturday, November 7 2020, four days after election day. AP made the call at 11.26am ET.

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The AP began calling races from 7pm on election day starting with Kentucky. Races in battleground states took much longer — with the AP calling North Carolina 10 days after election day and Georgia 16 days later.

Pennsylvania was the state that put Biden over the top, while Georgia and North Carolina were too close to call at that stage. Overall, Biden won six of the states considered battlegrounds this year, with Trump taking only North Carolina.

While Congress was certifying the results of the election on January 6 2021, a mob of violent Trump supporters attacked the US Capitol in an effort to halt the proceedings and overturn Biden’s victory. Democrats cite the events as evidence that Trump threatens democracy if he is re-elected.

In 2016, the AP named Trump the winner over Democrat Hillary Clinton at 2.29am ET on Wednesday, November 9, the day after the election. Wisconsin was the state that put Trump over the top, while Arizona and Michigan were still too close to call.

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What is different this time?

The biggest difference is that there is no pandemic.

In 2020, there was a surge in early voting as people tried to avoid catching Covid-19 at the polls on election day.

This complicated the tallying effort for state election authorities because many were not used to handling large volumes of postal ballots, which take longer to tabulate because they need to be opened and verified by election workers. Some states also had social-distancing rules in place for election officials that also slowed counting.

So far, fewer people have voted early — both in person and by post — than in 2020, meaning state election officials could have a more manageable flow of early ballots to process, therefore speeding up results.

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Trade Body 2.0 – Does the platform sector need a new voice?

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Trade Body 2.0 - Does the platform sector need a new voice?
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The platform sector is a diverse and fragmented industry in need of unification and greater collaboration.

In the past, many attempts have been made — unsuccessfully — to bring providers together under an umbrella group. The setbacks have always been attributed to the competing interests of platforms and, until now, there has been no formal trade group to represent the community.

The sector’s views have instead been represented by various organisations, including the Association of British Insurers (ABI), the UK Platform Group (UKPG) and The Investing and Saving Alliance (TISA).

However, all that is about to change with the formation of the Platforms Association.

People have been asking, ‘Why wasn’t this done five years ago?’

The association, which was launched in late September on the eve of the Schroders UK Platform Awards, wants to be the representative voice of the multibillion-pound platform sector.

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It claims the industry has “lacked specific sectoral representation and co-ordination” and “needs to take greater control over influencing regulatory issues and shaping growth”.

The trade body will act as a conduit for the sector to engage with regulators and policymakers, as well as co-ordinate and promote industry interests. Several leading platforms, including Abrdn, Aegon, Fidelity, Quilter, Seccl and SS&C, have already signed up.

The Platforms Association will be chaired by David Moffat, a senior director at SS&C who has decades of platform experience, and headed by industry veteran Keith Phillips, a former executive director at TheCityUK, the British Bankers’ Association and the Investment Association.

The pair will be supported by a board made up of leading industry experts.

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Organisational structure

Membership of the association is open to UK- and Europe-regulated platforms whose primary activities are the settlement, custody and safekeeping of retail investor assets, as well as sub-custodian firms and white-label technology providers.

There are also affiliate members drawn from platform consultancies, legal firms and software providers. In addition, related financial and professional services firms, including Alpha FMC, have been appointed as independent strategic partners.

The platforms obviously felt they didn’t have a trade body that properly represented their interests and needs

“Given a background of increased economic uncertainty and regulatory scrutiny, the UK platform industry now needs its own dedicated forum and representative voice,” says Moffat.

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“The Platforms Association will look to co-ordinate collective action and agree best practice to the benefit of platform operators, financial advisers and underlying investors.”

Phillips agrees.

“The investment and fund industry has been transformed and democratised over the past decade, with millions of customers now interacting directly with their financial futures through a platform.”

As a result, he adds, “sector-wide co-ordination should now be fully realised for the benefit of all”.

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The association has already developed a roadmap of priority issues to be tackled, including platform requirements, regulatory expectations, and operational efficiencies and improvements.

Having a body specifically for platforms will encourage a better understanding of the issues

These three broad areas will be overseen by a leadership council comprising representatives from across the industry. This will meet quarterly and set the strategic agenda for the association.

Membership of the council, chaired by platform veteran Peter Mann, will be by invitation only.

‘Hard prioritisation’

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Moffat says the association has already managed to collate a long list of 30 platform issues that the council needs to deliberate on.

The list was collated following consultations with the Financial Conduct Authority, the Investment Association, the Personal Investment Management and Financial Advice Association (Pimfa), TISA and other stakeholders.

“We have probably a capacity to cope with half a dozen [issues] at most and there’s some hard prioritisation going on,” says Moffat. “We need the leadership council to give us the steer as to what areas to focus on.

I’m not sure how dividing representation into two groups is helpful

“There’s a whole slew of other areas that potentially would justify, warrant and command our attention. But we’re going to have to cut our cloth accordingly,” he adds.

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The association will also have standing committees to cover legal, regulatory, operations and technology issues.

Moffat states that the association, which is a not-for-profit, is working closely with some of the leading financial services trade bodies, such as the ABI, Pimfa and TISA.

“We have talked a little about ‘Trade Body 2.0’ as a kind of model, rather than simply emulating some of the existing major players.”

He says the association is different from others because all its members, regardless of size and assets, will participate and contribute “on an equal footing”. The cost of membership is £10,000.

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Moffat continues: “I think that’s important, not so much for the amount but at the level that everybody is there equally.

“Part of the problem you tend to see with the pricing models that some of the other trade bodies adopt is that the biggest players contribute by far the largest amount of the money.

We hope this new forum can find common ground that enables progress

“The problem, of course, is that those very big players dominate and almost dictate the agenda that the trade body follows. And that’s what we’ve been keen to avoid.

“We want everybody sat around the table to contribute, and their value lies in the quality of their arguments and their analysis, rather than the amount of money they paid to be sat at that table.”

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Warm welcome

The sector has largely welcomed the newly formed platform trade body and the response from across the industry has been “genuinely quite flattering”, says Moffat.

“The one question that people have been asking is, ‘Why wasn’t this done five years ago?’

“There is no good answer to that right now other than the fact that it wasn’t. Let’s do it now, then, and get it right.”

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Platforum head Jeremy Fawcett thinks investment platforms should argue their corner with the regulator, the government and other parts of the industry.

In five years’ time, I’d like to see a platform community that is competitive and providing innovation and change at the individual platform level

It’s “surprising that it has taken so long to get here”, he says of the new trade body.

Fawcett adds: “Transact has been around for 25 years and collectively platforms hold a serious amount of the population’s wealth — about £800bn, according to our data.

“As a large and distinct part of the personal investing landscape, they find themselves in the regulator’s crosshairs and often need to respond in a co-ordinated way.

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“Asset managers and wealth managers have their own well-established associations to represent them and don’t just rely on the broader industry groups. Investment platforms are sensible to do the same.

“The platforms obviously felt that they didn’t have a trade body that properly represented their interests and needs, and spoke with a single, clear voice to the government, the regulator and the rest of the industry.

“TISA was never likely to do the job, given the wide range of members — from asset managers to large intermediaries — and the potential for conflict between them, although it remains a very useful forum.”

The challenge in platform trade bodies has been the fact there are some business models that significantly compete with each other

Söderberg & Partners Wealth Management UK CEO Nick Raine adds: “While not a silver bullet, we think having a trade body specifically for platforms will encourage a better understanding of the issues platforms face.

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“This will be a step forward from simply addressing the symptoms, which has often been the problem in the past.

“Platforms can improve transparency for end-clients and help advice firms fulfil their Consumer Duty obligations. With the additional support and advocacy of a trade body, we predict a bright future for platforms.”

Benchmark Capital chief executive Ed Dymott says: “We are always interested by improving industry collaboration, driving best practice and ensuring regulatory policy is appropriate.

“There is a lot of focus on platform business models, and we see benefits if there is more consensus in how the industry addresses key challenges.”

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Divided loyalties

However, not everyone agrees with the formation of a new platform industry body.

Parmenion chief executive Martin Jennings believes the UKPG represents the platform sector. He wants to see the group strengthen itself rather than have to compete with a rival trade body.

We’ve seen trade bodies that have tried to become quasi regulators; that doesn’t work out well for anybody

“We have currently decided not to join the Platforms Association and to continue to strengthen our representation through the UKPG,” he says.

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“I’d welcome anyone who wants to represent the industry or represent the interests of the industry and the clients within it. However, I’m not sure how dividing representation into two groups is helpful.

“I’ve a concern that we’ll end up diluting the voice because the UK platform people will represent themselves either through the Platforms Association or through the UKPG. And, when I look at
that, one group is surely better than two.”

Jennings hastens to add that his platform firm is not ruling out joining the Platforms Association in the future “if its voice becomes much stronger than the UKPG’s over time”.

The UKPG was set up in 2014 to represent retail platform operators. However, the group is limited to a small number of members in the UK. It does not have a formal legal structure or secretariat.

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They’re just drowning in stuff, trying to make some kind of coherence out of the whole thing

A UKPG spokesperson says the group remains active and continues “to deliver in line with the principles that govern it”, dismissing any suggestion of rivalry between the two trade bodies.

“The UK Platform Group is aware of the Platforms Association,” adds the spokesperson. “The UKPG, with Pimfa as secretariat, will continue to represent the views of its members and looks forward to working alongside the Platforms Association to improve the understanding of the industry and advocate for positive change.”

Definition debate

“‘Platform’ is a label in search of a definition,” the late Ian Taylor, a former CEO at Transact, once said. Decades after Taylor’s assertion, the platform sector still can’t agree on one definition.

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I put the question to the UKPG.

It replied: “It is not the role of the UKPG to define what is and what is not a platform. The UKPG has clear criteria for membership in its terms of reference, which are available on request to prospective firms who may wish to join.”

Meanwhile, the Platforms Association’s founders say they too struggled to come up with a definition.

“What is and what isn’t a platform has been a bedevilment all through the period. In the mid-2000s, this was a recurring theme on all the conference circuits,” says Moffat. “What we always agreed whenever we got bored was, ‘If it walks, swims and quacks like a duck, it’s probably a duck.’”

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We have currently decided not to join the Platforms Association and to continue to strengthen our representation through the UKPG

However, the association has opted for a broad definition of ‘platform’, he adds.

“The answer is: anybody who’s got a name above the door operating a kind of investment online solution. Most people know what a platform is when they look at it.”

The sector is beset with challenges, from regulation to tech integration. The association will face its stiffest task in getting a consensus on key industry issues.

Dymott says: “The challenge in platform trade bodies has been the fact there are some business models that significantly compete with each other.

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“This has always been a limiting factor for the sector in making progress. We hope this new forum can find common ground that enables progress to be made.”

Moffat agrees with Dymott’s assessment, adding that the new association is aware of the challenges ahead because of the “very disparate business models and players sat around the table”.

He continues: “You can’t really do anything in this space without potentially treading on toes.

This will be a step forward from simply addressing the symptoms, which has often been the problem in the past

“I would argue that a trade body, particularly one that’s trying to establish industry best practice and to provide thought leadership, should be treading on a few toes. Otherwise you’re probably not doing your job.

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“Ideally you want to do it in a way that doesn’t offend people. We’ve seen trade bodies that have tried to become quasi regulators; that doesn’t work out well for anybody.”

Regulatory scrutiny

Platforms have experienced a sharp rise in regulatory scrutiny since the introduction of the FCA’s Consumer Duty.

The duty, which came into force in July 2023, seeks to set higher standards for consumer protection across the financial services sector.

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In September the same year, the regulator sent a Dear CEO letter to platform bosses in which it outlined concerns that fees and charges might not represent fair value.

It said platform fees were “not properly disclosed” and consumers did not have a “clear understanding of what they are being charged”.

A similar letter was also sent last November on the practice of ‘double dipping’ by platforms. This led to issuance of several Section 166 reviews against platforms.

Moffat says: “Part of the challenge for the sector is a regulator that is not entirely comfortable with the behaviour of some of the platform operators. And that was evidenced.”

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TISA was never likely to do the job, given the wide range of members

He stresses that the Platforms Association is keen to engage with the FCA in addressing issues that affect the sector, saying that in the past the industry has struggled to get its message across.

“There is no steering group they can talk to,” says Moffat. “The challenge is, they’re having to have a multitude of bilateral discussions and they keep getting told different things and different approaches. And they’re just drowning in stuff, trying to make some kind of coherence out of the whole thing.

“While we probably wouldn’t have [the FCA] at the leadership council every time, there’s a standing invitation if they want to come along and discuss any of their concerns. They will get a very attentive audience.”

Moffat says the Platforms Association will focus on a comprehensive programme of activity to address high-priority industry issues.

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“In five years’ time, I’d like to see a platform community that is competitive and providing innovation and change at the individual platform level; which benefits from a coherent world view of what we’re doing and why we’re doing it; and which benefits from a number of common initiatives that strip away either costs or possible errors, or uncertainty as a whole.

Given a background of increased economic uncertainty and regulatory scrutiny, the UK platform industry now needs its own dedicated forum and representative voice

“I’d like us to be far more transparent with management information, and we’d like to have clearer best-practice guidance around what transfers look like.”

Watch this space

When it was launched in September, the Platforms Association was roundly welcomed by a sector yearning for representation.

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Those in favour say it was long overdue, while others prefer to wait and see.

Will it succeed where previous initiatives have failed?


This article featured in the November 2024 edition of Money Marketing

If you would like to subscribe to the monthly magazine, please click here.

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Warren Buffett’s Apple trade exposes Berkshire’s dilemma

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Line chart of Share price and index, rebased showing Apple has helped Berkshire outperform

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What is the next great investment idea? And what are the chances that Warren Buffett will be the person to identify it? Wall Street likes his odds. Shares in the class B of Berkshire Hathaway are up 25 per cent so far in 2024. And the rally comes as Buffett has been rapidly paring back his blockbuster win in Apple stock.

On Saturday, Berkshire Hathaway reported its third-quarter results, most notably that its cash and marketable securities balance had swelled to $325bn. A big chunk of that has come from share sales of Apple whose value for Berkshire now stands at $70bn, down from a peak of $178bn. Berkshire invested initially in Apple in 2016 when its share price was around $25 a share. Today Apple trades above $200.

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Berkshire’s total book value through the third quarter was $631bn, while its public equity market capitalisation is just shy of $1tn. That premium to net asset value reflects a vote of confidence from shareholders that Buffett, at 94, has another similar masterstroke in him.

Line chart of Share price and index, rebased showing Apple has helped Berkshire outperform

Buffett for now, however, is increasingly content to clip US Treasury coupons earning a few percentage points, risk free, with no dividends or real buybacks for Berkshire shareholders. 

It comes as other big pools of capital — alternative asset managers as well as BlackRock — are pouring funds into all types of plain and exotic private credit as well as long-tailed infrastructure and data centre deals. Blackstone, for example, has deployed $123bn in the past 12 months mostly away from either public or even private equity.

To be sure, Berkshire’s property and casualty insurance business carries out all sorts of sophisticated trading and hedging activities. But the investment group is best known for largely buying public, large-cap equities as well as mega operating business platforms such as power utilities and railroads. In the absence of a financial markets crisis where Buffett could play white knight to handsome reward, there is a question in calm markets if he needs to choose less vanilla securities.

The sheer size of Berkshire now makes it hard to find single investments that can move the needle. Its securities portfolio of more than $300bn has fewer than 30 stocks and the next Apple probably needs to be an up-and-coming Big Tech luminary. Buffett’s Apple bonanza helped obscure the dearth of juicy opportunities for Berkshire. That dilemma is now back on the table.

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sujeet.indap@ft.com

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