The UK Financial Services Compensation Scheme (FSCS) today provided a brief update on the London Capital & Finance (LCF) matter.
FSCS says it is continuing to prepare for compensation payments to begin under the UK government scheme. The body still expects to start by the end of November, and it will have made all payments by 20 April 2022.
As a reminder, you do not need to contact FSCS or do anything at this stage. FSCS has been writing to and calling a small number of bondholders to confirm some of their details.
If you are concerned whether a call, letter or email is genuine, you can contact FSCS directly using the details at www.fscs.org.uk/contact-us/. Remember that FSCS will never ask for payment as the scheme is free to use.
LCF was a Financial Conduct Authority (FCA) authorised firm which issued unregulated non-transferable debt securities, commonly known as ‘mini-bonds’, to investors and then speculatively invested the funds received in a number of underlying businesses. LCF went into administration in January 2019 and at the point of failure 11,625 bondholders had invested around £237million.
In May 2019, the government directed the FCA to launch an independent investigation into the events relating to the FCA’s regulation and supervision of LCF. Dame Elizabeth Gloster led the investigation, and her independent review , which the government published in December 2020, concluded that the FCA did not discharge its functions in respect of LCF in a manner which enabled it to effectively fulfil its statutory objectives during the relevant period.
Alongside publication of the report the government announced that it would establish a compensation scheme for bondholders who had lost money following LCF’s collapse. The Economic Secretary to the Treasury announced the details of the scheme in April 2021.
The LCF Compensation Scheme is a government funded scheme designed to compensate bondholders who suffered losses after investing in LCF, which entered administration in 2019.
The government has announced it will establish a scheme that provides 80% of LCF bondholders’ initial investment up to a maximum of £68,000. Where bondholders have received interest payments from LCF or distributions from the administrators, Smith & Williamson, these will be deducted from the amount of compensation payable.
The scheme will be available to all LCF bondholders who have not already received compensation from the FSCS and represents 80% of the compensation they would have received had they been eligible for FSCS protection.
I am truly thankful to the owner of this web site who has shared this fantastic piece of writing at at this place.
Customize your hero and embark on a thrilling quest! Lucky cola