Lehman backed structured product returns a gain

20% less than promised in the marketing

These investors were lucky that the product was split across five counterparties (which is pretty unusual). They got their money back and a small profit but in reality they got back 20% less than they would othewise have done.

Posted by: Missold

Missold misleads..again

It's a shame that your initially laudible campaign to gain redress for those MISSOLD investments has simply become your soap box to critisise an asset class. Clients were certainly not PROMISED anything in the Legal & General literature and the risks were correctly highlighted, (and, yes, I have read them, unlike I suspect you.)They also haven't got 20% less than they expected, that's simply your poor maths. Concentrate on getting redress, not on fabricating stories.

Posted by: Sage

sums

@Sage, here are my workings. Perhaps you can tell me where my sums are wrong, forgetting the counterparty point for a minute. The original offer suggested a minimum return of 125% with capital protection. This was reduced to minimum 20% return and 80% protection in Feb 09, after the Lehman collapse. According to this article, investors got 105.5% of their money back when the product matured. That's a difference of 19.5% on the 125% figure (expressed as a percentage of original capital). OK, so I rounded it to 20%. Or to put it another way, investors got 19% of the return originally suggested, plus their capital back. (ie 81% lower return). It is not about criticising asset classes. I just hope you are right that the 1000+ savers with £21m invested in this plan understood that they were 'not being promised anything' when they chose a capital protected plan.

Posted by: Missold

MISSOLD

Forgetting the counterparty point?? That is the point. Firstly, your sums are wrong because, as I said, and as you clearly fail to recognise, they were promised nothing. They were told very specifically that in the event of counterparty failure (sorry to bring that back up) they would receive considerably less than they invested. In this case, they received more, which was fortunate as, and you clearly know this, a lot of people lost everything when Lehman Bros went bust.  You use words like 'promised' & 'guaranteed' because you believe it legitimises your (as previously said) laudable campaign around misselling which, if you are not careful, will lose it's legitimacy.  Go and find the word promise or guarantee in the brochures, even those that were adjudged to have been at fault.  Structured products carry risk like all asset classes. If that risk is understood then crying foul play if a negative event occurs sounds sadly simply like an endorsement of the litigious society we have become. Explain the difference between seeking redress after investing in a structured product whose risks were explained, and investing in an index tracker where the index fell?  If you stop trying to be the saviour of the informed investor who has lost money, and continue trying to be the saviour of the misinformed who have lost money,  then your campaign has merit. Otherwise it just seems to be bitterness outweighing intelligence. As for it not being about an asset class, that's frankly embarrassing. I have not read an article on structured products in the last few years that you haven't commented on, often with commentary that is inaccurate and irrelevant. 

Posted by: Sage