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Acquiring customers is a costly business. Even attracting their attention is expensive enough, which is why those unlikely logos appear on the shirts of Premier League footballers. Last year, Plus500, a betting business for people who consider horseracing too tame, spent $934 for each new customer.

Many of us would happily accept $434 in cash in return for pledging never to become one, thus saving Plus500 $500 per person and us the worry of understanding contracts for differences or trying to guess next week’s price of bitcoins, dollars, gold or shares.

This is much harder than it looks, but lots of people (“mug punters” in the trade) think they can do it, and when the bet can be juiced up with borrowed money (“margin” in the trade) it is financially deadly. Indeed, it is so toxic that last August the European regulator imposed rules to save the mugs from themselves.

Plus500’s spread-betting rivals signalled that this would seriously cramp their style. Us not so much, said Plus, and the following month the founders helped meet the market’s “significant demand” by selling roughly half their shareholding, netting £145m. Reassuringly cheerful trading updates followed for October, November and December.

This week the penny dropped and so did the shares. The rules are going to hurt after all. Those punters will be harder to find, even at $934 a pop, and with the new margin restrictions, may take smaller risks and lose less.

Last June, Plus moved from Aim to the main market, necessitating a (legally binding) prospectus. This stated that the company had made “no net gains” for three years from trading against its customers’ positions.

It now seems that this activity produced a third of 2018’s profit, after substantial losses the previous year. The buyers of those shares last September may just feel they got it wrong. Alternatively, they may feel that having lost a third of their money, the terms of their bet were not quite what they had been told when they laid it.

Concentrating their minds

One of the more distasteful aspects of the collapse of Carillion was the contrast between the pension prospects for the bosses and those of the workers. While the workers’ scheme was £1bn in deficit, that for the executives was adequately funded. As a result, the failure will force a cut in benefits for all but those at the top.

This has prompted Joanne Horton at Warwick Business School to propose outlawing separate executive schemes. Were the bosses in the same boat as the workers, they would think twice about paying dividends today while deferring funding a pension deficit into the far future.

Her research found that CEOs were significantly less likely to close a scheme if they were members. It would concentrate their minds wonderfully, or at least better than the government’s proposal to jail bosses who play fast and loose with pension funds.

Unfortunately, it is too late to do more than slow the exodus from defined benefit schemes. It is not only the CEOs, with an eye on their share incentive schemes, who want out. The trustees have a miserable, and usually unpaid, task. As the guidance notes from HMRC point out: “You may be personally liable for any loss caused to the scheme if something goes wrong.” The advice to anyone tempted to become a trustee is to lie down until the feeling goes away.

Just another central bank

It’s tough being governor of the Bank of England. You are expected to see the future even when nobody else has a clue, and you get pilloried when it turns out differently. The return of inflation to its target this week was a rare triumph, and Mark Carney is surely counting the days for this cup to pass from him.

He would be less than human if he did not notice that Mario Draghi is expected to retire later this year and there is no outstanding candidate for the next president of the European Central Bank. They look like mythical old favourites Jacques-Anonyme Énarque or Wim Wimp from the Rentadutchman agency. If a Canadian can run the BoE, then why not the ECB?

A full list of Neil Collins’ financial interests can be found at www.ft.com/collinsportfolio

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