Summer Adjournment
Debate between Lindsay Hoyle and Nadine Dorries
Nadine Dorries (Mid Bedfordshire) (Con)
First, may I say what a pleasure it is to follow so shortly after my hon. Friend the Member for Witham (Priti Patel)? It is a delight to be speaking in the same debate in which she made her maiden speech. I am sure some of us can remember how terrifying that is, and my hon. Friend did amazingly well.
I want to use this opportunity to highlight the unusual case of an institution that fails people who look to it for protection and help when situations go wrong. I shall mention the names of a number of people and organisations, but there is no court case pending so that is not sub judice.
Many people work hard all their lives, and save hard. Some people may run corner shops or work as self-employed plumbers and save a deal of money, and a time comes in their life when they realise that they want to use that money for their pension or to help them through their later years, so they look to make investments with that money. Some people will use organisations such as investment banks and stockbroker firms, and I want to talk about a particular stockbroking firm with which, in 2007, a number of people decided to invest their life savings. This story is also about the Financial Services Authority. The company took these people’s life savings—a number of people’s livelihoods were also involved—and within weeks it had all gone.
A trader by the name of Stuart Waldron handled the accounts of these people. He asked all of them to set up a separate e-mail account that he could use for trades only. He then rang particular people and said that the e-mail account was not working and asked for their password. The investors thought that there was nothing unusual in that, because the account was just for trading, so they gave the trader their password. He then proceeded to send messages to and from himself giving instructions on buys and sells. When that became apparent, the FSA became involved and I sent a number of documents to the authority. That was a considerable time ago and I have not yet had a response from it. I e-mailed the relevant inspector at the FSA, Margaret Cole, three weeks ago because I knew I was going to speak about this matter today, but I have not had a reply.
The stockbroking firm is called WorldSpreads, and it operates outside the City of London—surprise, surprise. Therefore, it does not come under the jurisdiction of the City of London police. It appears that the people who run WorldSpreads used to run a stockbroking firm called Square Mile Securities, which was inspected and closed down, although because of its financial situation at the time, it paid a reduced penalty. Those people from SMS who were closed down and had to pay that fine then went on to set up WorldSpreads. The inspector who closed down SMS was Margaret Cole.
WorldSpreads held up its hands and said Stuart Waldron was a rogue trader. My investors decided not to believe that and chose instead to take the case further. They had a meeting with the directors of WorldSpreads, which was recorded. On the recording it is made very clear that Stuart Waldron was not a rogue trader but that the operation was planned—indeed, it was a procedure that the company appeared to carry out regularly.
One key point is that the FSA has so far failed to represent the individuals who have lost their life savings, but there is also a bigger point. I am aware of this group of individuals—I know what has happened to them in their particular case—but how many more stockbroking firms are operating in such a way? How many more individuals are the FSA failing to protect? How many people are walking into a stockbroking firm with their life savings—even as I am giving this speech today—trusting that firm and hoping that there is a procedure behind them and an organisation such as the FSA that will regulate and monitor events and protect them should something go wrong and their life savings are taken away?
I am not being naive in making this speech, and I am aware that financial journalists might want to pick up on this story. If they do so, we would love to know whether Stuart Waldron, who disappeared overnight, is still trading somewhere in the City of London. We have a barrister’s statement of case that analysed the whole situation. Unfortunately the case cannot be taken on any further because there is no money left to do so; the people involved cannot fight their corner. If any financial journalist would like a copy of the barrister’s statement of case they would be very welcome to it.
It is amazing that an organisation such as the FSA, which is supposed to protect the interests of ordinary hard-working people, should have let people down so spectacularly. It will not be the stockbrokers, the City bankers or the huge institutions that bring about the upturn in this country; it will be the hard-working individuals who set up their own businesses, go to work every day, save as hard as they can and hope that, with those savings, they can look after themselves and their families and see the rewards of their labour. It is an absolute disgrace when organisations such as WorldSpreads try to blame their own misdemeanours, corrupt dealings and failings on one individual, Stuart Waldron, who disappears overnight—paid, we believe.
I hope that while I am giving this speech there is not someone sat in the WorldSpreads offices handing over their life savings, because we will know what will happen to them. We know the pattern: over a number of weeks, those savings will dwindle and suddenly, a situation will occur—perhaps like that involving BP—and the explanation given will be, “We are so sorry your savings have disappeared, but the markets were badly affected by the current situation”. That provides the smokescreen for such activities. We know the corrupt e-mails that such organisations send. They depend on the naivety and inexperience of those who do not have the educational background in, or experience of, the financial markets.
I am sorry to have taken the House’s time up with this case. I hope that, as a result of highlighting it today, some steps might be taken towards providing justice and to returning some of those people’s money to them.
Mr Deputy Speaker (Mr Lindsay Hoyle)
I call Graham Jones. I remind the House that this is a maiden speech.