HC Deb 15 February 1934 vol 285 cc2091-2

asked the Chancellor of the Exchequer whether he is aware of the creation of a number of fixed trusts designed to attract small investors content with a moderate rate of interest in return for safety; and will he, before the creation of fixed trusts is carried to excess, appoint a committee of experts to advise the Government on the principles underlying fixed trusts and what should be done about further flotations, so that unscrupulous persons may not use fixed trusts for exploiting the public?

The CHANCELLOR of the EXCHEQUER (Mr. Chamberlain)

The facts, so far as I am aware of them, do not seem to me to call for any action by the Government. I think that the public can best protect themselves against exploitation of the kind suggested by declining to invest in any fixed trust which is not under the control of trustees of the highest repute.


Seeing that fixed trusts do not come under the Companies Acts, and that the holders have no voice in the administration, are the Government not taking a responsibility in not issuing a warning?


Possibly my reply will be taken as a warning.


Has the right hon. Gentleman noticed that there is apparently no obligation on the promoters of a fixed trust to issue a prospectus, as in the case of a publicly issued limited company, and may not the omission of the necessity to issue a prospectus, which was probably unforeseen, afford unscrupulous persons an opportunity for victimising the small investor?


I have no doubt that the matter is being carefully watched by those who are most closely concerned.