|Dear Client and friends|
I am immensely angry that despite warnings to the Trust in regard to the use of data from regulatory disclosures, many clients have received a second letter from Blue Planet. I wanted to assure clients that they have to do nothing as a consequence. Again I must issue a full letter to clients as soon as possible. There is no ‘urgency’ to do anything and all our and clients’ rights are preserved and assured. We shall vote our clients’ shares at the AGM next month as we are authorised to do. The Board of the Investment Trust and its solicitors Samuels, have been ill-advised to send these letters. It is unbelievable the managers are trying their utmost to create a smokescreen to deflect from their results and to accuse us of wrongdoing!
What is crucial to note is that this holding is a mere 0.5% of our total client assets. Yes, for every £1,000 of client money, it represents £5, so a very small sum. That means £995 of every £1,000 of clients’ overall assets is in other investments which are all doing what they should be doing together. I am not belittling any loss as losses are all frustrating but this holding will continue to be insignificant going forwards.
I am providing more detail below if you want it but I needed to reassure you that no action is required and there are no concerns about how we are continuing to manage clients’ capital very successfully, even despite the very difficult backdrop the world is providing presently.
My very best wishes
The background to it all and what next?
For over two years we have been very concerned at the Trust’s management. Their latest letter is an attempt to cause us as much disruption and distraction as well as attempts to discredit our achievements and capabilities. We have done nothing wrong whatsoever, sadly aside from having an investment which has fallen in value after we purchased it and as a consequence of actions taken by the Manager from February 2020 onwards. However, just because of this, we must reassess and make decisions such as ‘do we continue with it?’ ‘Is it better to sell it and if so at what price?’ or ‘do we buy more because despite the bad information, the price at which we can buy stock is far too cheap?’. We make these sorts of decisions all the time. Up till only 31 May 2022, the regulatory benchmark the Trust used to compare its strategies was the FTSE100 – the UK’s biggest firms. Then, with no formal shareholder approval the Board changed it to the speculative Nasdaq Composite 100, the US technology index. We acquired the vast majority of shares for clients way before 31 May 2022.
Blue Planet Investment Trust Plc is not even registered with the Information Commissioner to use your personal data:- https://ico.org.uk/ESDWebPages/search/. Do feel free to inform the ICO.
We are liaising with the FCA but clearly cannot publicise our exact actions, to avoid inflicting more pain on the Trust (which ultimately is its shareholders).
They make misplaced assumptions about the relationships we have (and most have been clients for many years). Blue Planet knows nothing about these. The cost of this letter will no doubt be billed to the Trust so shareholders have to pay.
Despite its awful results since the Pandemic lows, its poor performance has been more than compensated by the exceptional overall results from our clients’ other assets. Clients with us since then enjoyed the best performance period the Firm has seen since 1985 and whilst the last eight months have been difficult for everyone, we remain proud at what we have been able to do during that time.
We have been humbled by so many supportive comments over this issue and are very grateful for them. We hope clients all know that we always have their best interests in mind in everything we do. We have never abused the agreed aims with clients in relation to ‘risk’ and its management and that is why we have such a little sum in this awful Trust – awful since the managers transformed what it was doing, without specific shareholder approval.
Indeed, this comment is perhaps the most telling and is actually from a blood relative of one of those involved ‘on the other side’:-
“I have been following the Blue Planet saga, in which you are currently embroiled, with some interest. But I have to let you know that as long-term clients of yours, my wife and I have every faith in your ability to handle our investments in the competent and professional manner that we have come to expect from P J Milton & Co. Plc.
It is quite clear that BPIT are trying to drag your company down by drawing the attention of the regulatory bodies to what they claim is mis-management by you, in order to divert attention away from their own far greater mis-management!
The fact that my investment holdings contain a very small percentage of Blue Planet shares is of little consequence as I consider that quite acceptable as a medium risk investor!
I don’t think you need to worry about any legal proceedings from Samuels solicitors; I wish you the best of luck and hope this has cheered you up!”
Despite this, if clients are concerned, The Ministry of Justice and the Financial Conduct Authority encourage investors to use the free services should they have complaints. The MOJ has said:-
“It is straightforward to complain to financial firms directly, and if necessary to the ombudsman service or FSCS. Complaining yourself is free, and you will keep any compensation you receive without any fees being deducted.”
Solicitors are not charities. If they are engaged investors could end-up paying considerable costs to them and defence costs against unsubstantiated allegations. If you remain concerned, call the Financial Ombudsman Service on 020 7964 1400 or see:- https://www.miltonpj.net/documents/Complaints%20Procedure.pdf
We are alarmed anyone may have been encouraged to believe that we are not a very successful, independent financial advisory and discretionary investment management firm which clients know they can trust to do its very best for them.
We now employ thirty-two staff and manage £235million on behalf of many thousands of clients, mainly in the UK but with global tentacles. We have managed money for many more years than Blue Planet (or Samuels) have existed. This covers portfolios, ISAs, Pensions, etc – whatever clients need and for their tax planning and savings. Generally we are long-term investors with traditional ‘value-led’ strategies and doing us and all clients extremely well over the years (despite latest global difficulties), generating excellent levels of regular income for those who needed that too, especially in times of very low interest rates. We know how to manage all the necessary risks and issues in looking after them.
In 37 years’ managing experience, we had never had a situation where a Trust manager has not appreciated our input even if we disagreed and then, after an atrocious performance, writing to our clients (details obtained legally under Company disclosure law) with defamatory comment as well as arranging for a firm of Barnstaple lawyers (Samuels) ‘and a barrister’ to threaten us with a libel suit when we flagged problems. Never have we had to raise our concerns with the FCA like this.
However, it is our duty when it is clear something has gone horribly wrong. Sometimes simple disposal is right to cut our losses and sometimes other actions are best – that is part of our job. We have discretionary control and we do our best at all times. Sometimes (as with our biggest holding now) it can include buying further cheap shares in a quoted investment fund about which we have ‘concerns’ because a significant discount to underlying asset values exist and in some way, we may unlock that. Some of the best returns we have achieved over the years have been buying less-than-best investments (however defined) but at prices which were far too cheap.
We do not invest in ‘non-readily realisable investments’ for anyone and never have. We have informed Blue Planet on this point many times. This is the regulatory definition:- https://www.handbook.fca.org.uk/handbook/glossary/G948.html Blue Planet Investment Trust is a Plc, fully listed on the London Stock Exchange. We have never had difficulty selling a clients’ holding in this Trust though it is foolhardy to sell a large quantity of most things all at one go.
We have indeed bought a very small quantity of additional shares and primarily for the Plc itself in fact (so not client money) and not for clients who already had them. The last ones we bought were at 9.1p when the quoted asset value was over 16p, so for that piffling acquisition, even a liquidation would generate a capital return of over 75%. However, there is another very important additional reason and that is to ensure they cannot push-through a motion disadvantaging our long-suffering investors. We are only assured of that if we hold over 25% of the Company, which we now do. Otherwise, if the Trust liquidated, despite the awful results, their related management company would be in line to receive two years’ fees and fixed costs and the directors would be likely to receive payments too.
Their letter suggests we declined a motion to liquidate the Trust. There is no such proposal mentioned in the latest Annual Report. No formal proposal exists. My letter to Mrs Murray on 26 August 2021 (to which they make no note) made many suggestions they ignored. Indeed, if the Board believed that was viable, then it did not need us to agree as the Murrays had effective control to present a formal motion. Whether we would have agreed with it or not, we did not own enough shares to block the motion the Murrays could have tabled. They could also have sold all the assets to bank higher values in anticipation – they did not.
I shall be in touch with clients soon. If you have received a letter, I am very sorry that you have been concerned and inconvenienced but please, you are not obliged to do anything – that is why we work for clients, it is our job. This should never have arisen and clients should not have been contacted in this vein at all. Please do not worry as nothing has changed with clients’ risk profiling either.
My best wishes
Philip J Milton DipFS CFP™ Chartered FCSI (Financial Planning), Chartered FLIBF, Chartered FPFS Chartered Wealth Manager