Every time Peter Cloke visits his wife Millie in her care home in Woodbridge, Suffolk, he arrives bearing treats such as chocolates or sweet-smelling shower gel.
To pay for these, the 79-year-old former accountant invested £5,000 in March in a new bond from the Royal Masonic Benevolent Institution Care Company (RMBI).
Founded in 1850, the RMBI runs care homes and sheltered accommodation for more than 1,000 freemasons and others.
The issue was a success, raising £20million. Maturing in 2029, the bonds offer 6.25 per cent interest, paid twice a year, with the first payment due on September 7.
Peter had only invested in equities and unit trusts before but the bond’s charitable nature attracted him. The Masonic backing was reassuring and he was keen on the fixed twice-yearly payments, which he decided to spend on those treats for his wife.
Weak link: Each party had done its bit except for Euroclear
Having bought the bonds via wealth platform Hargreaves Lansdown, Peter duly checked his account on September 7 for the first payment. It had not arrived and, as days passed, he worried. Peter was not alone. Hundreds of investors were in the same boat, many having poured £15,000 or more into the bond issue.
Mark Lloyd, managing director of the RMBI, was astounded when distressed bondholders contacted the charity. He had made sure the money was sent out on time to be forwarded to bondholders.
But the process is complex, with the funds going through intermediaries before reaching Euroclear, the Brussels-based clearing system ultimately responsible for sending the cash to brokers and investors.
Research by The Mail on Sunday revealed each party had done its bit except for Euroclear. It only moved the cash when urged to by Lloyd and colleagues. By the end of last week however, bondholders had been paid. Now Peter can stock up on treats for his wife.
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