Returns are not guaranteed. Your capital is at risk. Past performance does not indicate future results.
This notice sets out the principal risks of participating in secured private lending opportunities introduced by Mykhaylo Yuzak (trading as CashFlowedX). Except where marked otherwise, the wording below is a structural draft only and has not yet been reviewed by a solicitor. It is not a complete statement of every risk involved.
1. Your capital is at risk
[PLACEHOLDER — pending solicitor review]
Explain that some or all of the capital committed may be lost, that there is no guarantee of repayment of principal, and that the investor should only commit capital they can afford to lose in full.
2. Returns are not guaranteed
[PLACEHOLDER — pending solicitor review]
Explain that indicative or target rates are projections rather than promises, that interest may be paid late or not at all, and that past performance of previous opportunities does not indicate future results. Confirm how any rates quoted elsewhere on the site are to be described and caveated.
3. Illiquidity
[PLACEHOLDER — pending solicitor review]
Explain that loans are not readily realisable, that there is no secondary market and no ability to redeem early, and that capital may be locked up for the full term and beyond it if the borrower’s exit is delayed.
4. Borrower default
[PLACEHOLDER — pending solicitor review]
Explain the consequences of a borrower failing to pay interest or to repay at term, the recovery and enforcement process, its cost, its duration, and the fact that enforcement may recover less than the amount outstanding.
5. Property market and valuation risk
[PLACEHOLDER — pending solicitor review]
Explain that the value of the underlying property may fall, that valuations are opinions given at a point in time and may prove inaccurate, and that a fall in value reduces the protection provided by the security. Cover development, planning and build-cost risk where the loan funds works.
6. Concentration risk
[PLACEHOLDER — pending solicitor review]
Explain that participating in a small number of loans, or in loans secured on property in a single region or of a single type, concentrates exposure, and that diversification should be considered.
7. Security — first legal charge, and its limits
[PLACEHOLDER — pending solicitor review]
Explain what a first legal charge is and what it does and does not provide. It ranks ahead of subsequent charges but does not guarantee full recovery: sale proceeds may be insufficient, enforcement takes time and incurs cost, and prior interests or defects in title may reduce the amount recovered. Confirm how security is held where more than one investor participates in the same loan, and describe any security trustee arrangement.
8. No FSCS protection
[PLACEHOLDER — pending solicitor review]
State that participation is not a deposit and is not protected by the Financial Services Compensation Scheme, and that no compensation scheme covers loss of capital in these arrangements. Have the solicitor confirm the exact wording.
9. No regulatory protection
[PLACEHOLDER — pending solicitor review]
State the regulatory position: the intended position is that CashFlowedX is not a regulated financial services firm, is not a registered broker-dealer or investment adviser, and provides business introduction services only, with the consequence that recourse to the Financial Ombudsman Service and other regulatory protections is not available. Have the solicitor confirm this position and the exact wording, and check it against the description of the service in the Terms of Service.
10. How we are paid
Factual disclosure — not placeholder text
- CashFlowedX earns a 2% finder fee, and that fee is paid by the borrower.
- The investor pays CashFlowedX nothing.
- CashFlowedX is non-custodial and never holds investor funds. Capital transfers directly from the investor to the borrower.
11. Taxation
[PLACEHOLDER — pending solicitor review]
Explain that the tax treatment of interest received depends on the individual’s circumstances and may change, that no tax advice is given, and that independent tax advice should be taken.
12. Independent advice
[PLACEHOLDER — pending solicitor review]
Recommend that prospective investors take independent financial, legal and tax advice before committing capital, and confirm that CashFlowedX gives no personal recommendation.
13. Contact
Questions about this notice can be sent to cflowedx@gmail.com, or by post to Mykhaylo Yuzak, ul. Jana Kazimierza 32B/55, 01-248 Warsaw, Poland.
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