UK 04:26 Sunday, 25 October 2026
Breaking news and expert analysis on fast-moving AIM and LSE listed shares
Disclosure: I own shares in one or more of the stocks mentioned. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
Evidence started to emerge four weeks ago of a major problem with the nominee service used by clients of Barclays Stockbrokers, Barclayshare Nominees. There is now a strong suggestion that Barclayshare Nominees and Barclays Stockbrokers have disposed of clients’ physical stock without their permission. This is a shocking turn of events in the New World Oil & Gas (NEW) forward selling fiasco and points to an even graver flaw in the mechanics of the London Stock Exchange’s Alternative Investment Market. Something like this should just not be possible, but the numbers appear telling.
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Comments
wildrides
All big nominees lend out shares to shorters for covered shorting . Thats how they can offer dealing at a fiver a throw . Its subsidised by lending out stock and subsequent fees .Barclays have just got caught with more out than the rest . I am with Barclays . I have traded NEW for several years and been completely out and completely in over the period . I usually hold a small token amount all the time (100k shares) All my deals have settled and the deals proceeds credited to my account ( which is what matters ) The right to the paper cert in a suspended share is somewhat tenuous in the circumstances . If you want dealing costs to rise to £30 a trade like the bad old days then ban lending out shares to shorters by your nominees……….. simples .
drunken sailor
Ben,
Day after day more NEW shares were traded than were in existence. Many people bought shares and sold them later. The LSE reminded brokers that they had to settle on time. Nominee accounts effectively pool all the shares and provided settlement occurs both ways the number of shares on the register will roughly approximate the number of shares in client accounts. If Barclays settled all the sells from the pool (as LSE had said they must), but only received a small amount back from the buys, the pool would have been drained very quickly. Barclays are not alone in being in this position. They have just not been upfront in explaining the real reason why they are in that position and indeed very few other brokers have been. I saw one post from someone not with Barclays (I can’t remember who they were with or if they actually said who) that was open and said we are very sorry that we can’t certificate your shares (which had been held for a long time) but the pool is empty. Not a good answer, but at least an honest one.
Given that most other brokers have given similar excuses, I suspect that the LSE has told brokers not to reveal the true reason why they are in the mess they are in. When the settlement situation is resolved the pools will all be refilled. It is however shocking that the LSE allowed the debacle to continue as long as it did. The real blame for this aspect of it lies with the LSE. There was an obvious false market as pointed out by Share Prophets. LSE should have suspended there and then and wound back all the trades, however they blundered on to a point where that would be impossible. Will the LSE learn the lessons from this? Possibly, possibly not.
DUCK AND DIVE
Good story, Ben. Keep digging to make it a great one.
As a Barclays client – albeit in the great majority (I assume) who have never owned a NEW share – I do know that they are extremely careful to do most things by the regulatory book. But they also make mistakes.
Given the way in which the big banks are policed these days, I would be surprised if they had knowingly acted improperly.
Ben Turney
@wildrides – the stock being in suspension has nothing to do with the ability of shareholders getting their stock rematerialised into certificated form.
Ben Turney
@Drunken Sailor – your assessment of the situation is incorrect. I have become intimately familiar with the position of all the major execution brokers. Each firm has been able to identify which customers have settled stock and which have unsettled stock, to the extent that some members of the action group have both settled and unsettled shares.
As for Barclays not being alone, you are correct and I am circling in on a second broker that has done the same thing.
@Duck and Dive – thank you, there is more to follow on this story
wildrides
Ben …………….. course it does ……………. if they were able to get a cert ,then they cant trade it anyway . I have requested certs before for other reasons and it always takes about six weeks to arrive , sometimes longer , depending on registrar work load . In the normal course Barclays would simply buy them back in the market if urgent , but of course in suspension they cant do that . Read the small print for Barclays L2 trading ………… there is acres of it ………. and they will be covered by one clause or another . What your trying to do is make the incompetence of NEW board and broker into Barclays fault .
You would be better off tackling the NEW rns yesterday :-
The board seem to think taking their wages as loan repayments makes them some kind of heros . Do they think punters are fecking stupid or what ? Note that their wages are still accruing ………… NOTHING has been given up except a movement of cash . They are trying to get the 1 mill deposit back ! are they fecking stupid ………. they backed out of the deal and lost the deposit as a result ………. that is what deposits are for ……… you dont get them back if you fail to complete!
Ben Turney
@Wildrides – The whole six week processing argument is at the centre of this argument. New World’s registrar has been processing applications on pretty much the same day.
As for your comments on “normal circumstances” yes that is probably what would happen but in this instance Barclays Stockbrokers looks like it has been caught well and truly with its pants down. More to follow
drunken sailor
Ben,
It is not about whether they can identify which trades have settled or not – I am sure they can, though as people have asked is my trade settled conflicting answers have been received. The issue is Barc have settled more sell orders than they have had buy orders settled that is what has drained the pool.
Maybe they had loaned some stock for shorting before the debacle, who cares only BBMs think shorting is wrong and should be banned. I do not recall NEW being heavily shorted before this all blew up.
The nominee account brokers are the victim in all of this, they have followed their clients instructions and because shares that did not exist have been traded some are sitting on large black holes. The nominee account brokers are in the front line of the anger from their clients and whilst Barc have not be open and honest, and neither have a lot of others, that is all they have really done wrong and that has probably been on the instruction of LSE who are covering up their own failure and the failure of the real culprits.
That is not to say that their clients should give them an easy time, far from it! If you are a client of Barc or any other broker and you have not got what you want in this mess give them hell at least once a day – e-mails from Joe PI are water off a duck’s back for LSE but when Barc, TDDI and others start saying “you complete wankers you have caused us so much hassle because of your total fucking incompetence get your shit together and make sure this never happens again” or words to that effect, then just maybe the complete wankers at LSE will finally pull their heads out of their arse and decide to run AIM properly.
Ben Turney
@Drunken Sailor – just think your first paragraph through. How could BS have settled more sell orders than buy orders, unless its retail customers were shorting, using something like T-20s?
While that is possible, it doesn’t seem very likely.
The 1.7million shares I’ve identified were owned by long term holders.
drunken sailor
Ben,
For several days more than the real number of shares in issue were being traded indeed some days it was double the number in issue – these shares were being bought and sold by a whole variety of people using a whole variety of brokers some with short settlements some with longer settlements. I often buy on a longer settlement to give time for money to arrive but always sell on short settlement as there is no point in having a longer one.
A Barc customer buys NEW – trade is not settled in accordance with the agreed settlement date, but a few days later they sell, Barc have shares in the pool, they are being told they must settle the trades they settle with shares in the pool, expecting that the buys will get settled. Different brokers will have brought the shutters down on settling sells at different points, it sounds like Barc were quite late in doing that.
There is a black hole of shares up to the placing number of 2.7 Bn. The placing shares were not admitted to trading but were traded, thus that black hole has moved to various brokers around the system who have clients who bought and sold during the period when trades were not being settled. There are other brokers in exactly the same position, some do not have quite such a large black hole and can certificate, others do not have enough shares in the pool to certificate. Though in exactly the same way as if we all went to our banks and asked for our accounts to be closed and to be paid in cash the banks would not be able to provide the cash, if every NEW holder with settled shares asked for them to be certificated I doubt any broker could do it right now.
All makes perfect sense and is effectively what Barc told you. When the settlement situation gets resolved they will have all the shares to match with client holdings, until then they are coming out with a variety of conflicting excuses, as are a lot of other brokers, presumably because they have been told not to reveal the true cause or the size of the problem.
As I said in my original post one broker has been honest with their client (a long term holder of 3 years) and told them straight, we cannot certificate your holding as the pool is empty.
There really is no other logical explanation as to why all brokers have a deficit in their pools to some extent or other.