I read the two different versions of the new terms and I must admit…
A) my favourite broker continues to be naive in the way they spend their money (and yours if you bought into FT)! Rewriting these must have cost money. And whoever wrote these needs to be docked their pay. It’s embarrassing actually. And these types of mistakes detract and decrease, at least my confidence in the company’s ability to act as custodiers of my money
Please see Sec 4.2 obligations in respect of freetrade isas…
Genuinely @Freetrade_Team you need to start proof reading your stuff because you’ve just published terms that will make some of your customers ineligible to hold this product, per your terms and conditions. This isn’t the first time either!
B) I noted sec 28 and 29 and wondering if this is the precursor to calls/puts and other speculative stuff as popularised by the marketeers of our interatlantic cousins…
I sincerely hope that if this is the case you will seriously consider the customer experience this time round rather than your “tech partners”. Also wondering if others see it like this too.
C) as a last point… can anyone answer who “platform one” is please???
A) That really should have been caught before publication. This needs to be fixed @acamp can you flag this?
B) I don’t think this seems to be in-depth enough to be referring to activities such as calls or puts (pretty sure we would all know about it if it was in the pipeline). I think this is more to do with situations where things like the subscription fee hasn’t been paid, a payment from a bank has been reversed.
C) Platform One is the new pension administrator that took over from Gaudi.
Answering one of your questions (point c) ), Platform One is pension provider for Freetrade SIPPs. Gaudi, the previous service provider, went into administration and sold their SIPPs business to Platform One as per FCA news article below.
Gaudi Regulated Services Limited in administration | FCA Gaudi Regulated Services Limited in administration | FCA
A well thought and concise response thank you! They only thing I don’t share is enthusiasm about the rest of the terms around sec 28-29 I read the stuff and my reasoning, although admittedly purely speculative and based on nothing more than what they wrote, is that it opens the door. Admittedly rather slowly. But nonetheless opens the door despite what they wrote around it, and specifically because of how they wrote term 29.1
You see that doesn’t say, “in relation to outstanding fees” ie specifying why we would owe them money. 29.3 gives a misleading example that leaves open the rest of the reasons why me or you would owe FT money. If I was cynical I would say it was deliberately written in this way to lead us to the conclusion that the terms mean sub fees debts.
Moreover read again 29.1.2 please and let me know what you think. On the basis of the current fee structure of any of their products I cannot for the life of me work out a situation where, due notice having been given, you would rack up a bill that allows FT to behave as described in that section… can you?
Thank you for this and for the link I will have a little read of that
This seems fairly standard practice. If you don’t pay your fees, brokers will sell assets to cover it.
Perhaps I’m missing something?
As I explained it’s the openness of the language that has my antennas perking. The idea behind my comment is that the standard practice, as you rightly point out as typical, is not explained in an easy to understand and more than anything else, in specific language.
the cynic in me for the reasons I explained can’t help wonder why they didn’t simply specify the reasons why a customer would owe them money. The only reason you would owe money I can see at the moment is because your fees have not been paid. No other scenario in their products allows you to go in the red. That’s essentially correct, no?!
And yet they chose to write terms and conditions that are vague about why you would owe them money! More than that they chose to describe that they can be picky in the way in which they dispose of your positions in order to cover the debt.
I want to think it’s simply a poor draft. The reason why I think it’s a poor draft is because whoever wrote this was probably under instruction of covering the fractional element of US shares…
I don’t want to get complicated with my response but the things that actually make sense when thinking about why FT would behave like this is the fractional element or if the liability is a significant amount.
What other scenario other than “we need to sell multiple positions to cover a larger sum” or “we need to sell loads of small positions to cover a sum” can you think of?
Section 29 is actually a lot more specific than the previous version in section 6.3 which was effectively “well take your money if we have to”
The new version now seems to more specifically call out the steps involved and covers SIPP scenarios.
the wording about fees is effectively the same
If the amount of your Available Funds is insufficient to cover any outstanding fees that you owe us (including any Subscription Fees),
If you fail to pay any amounts that you owe us and we have given you reasonable notice that such amounts are outstanding, we may:
That they would recover any outstanding fees was always in the terms. Im confused to where you got calls/puts or speculative services from?
Where in the terms are these two statements?
Id be more concerned with section 33. Death or mental incapacity
Which only states an option to terminate your account. Death wasn’t in their terms before (there’s a thread on it), if termination of the account rather than transfer of ownership is the only option, then this is a bit of a downer on Freetrade for long term investing. (imo)
This post though suggests transfer of ownership (at least out of Freetrade to another account) is possible. the terms don’t make that clear in this case 💀 What happens to your account if you die? 💀 - #113 by MeghanB26
(also TOC 36 doesn’t match header 36)
I think perhaps I didn’t make it clear that those two statements were scenarios that I think explain why FT would behave like this when it comes to moving several positions at once.
Having said all that. The question “where did you get “calls/puts” from” is legit. I think I explained though in my other comments that it’s speculation on my part as to why the language is so open.
Lastly the fact that you unearthed the previous version of the terms and are pointing out the similarity in the wording is positive and I think in a sense re enforces my point that the terms need a rethink. This is because the state of the terms being “more prescriptive than before” doesn’t quite cover the current state of being “not adequately specific” overall.
What I’m saying here is that imo they have to specifically mention why and how an FT customer will incur debts on the platform. If they do anything else then the speculative comments (read puts/calls) are fair game
Thanks for this link I actually contributed to that discussion around December 2020 and the real issue is that despite the reasonable voices in that discussion it took about two years for anything to be addressed as being put in place, similar to other concerns about operations that some of us have raised. This comment isn’t so much about how they handle this but the lack speed by which important issues like a sudden death or mistakes in the terms actually take to be acknowledged and resolved
Also I think if you are referring to severability in section 36, then the header and the content do probably match. To me it reads like this
If a court finds for example section 4 invalid or unenforceable (ie because FT wrote it wrong) then that section “severs” from the rest of the agreement that remains in force. It’s a narrow point but it reads ok.
Of course if a court finds section 25 invalid this creates all sorts of interesting situations, but I’ll let FT explain that one to you…
Thanks for flagging this one. We’re updating this immediately!