FSCS to begin issuing decisions on London Capital & Finance advice claims by end-May
The UK Financial Services Compensation Scheme (FSCS) has now started the process of reviewing individual claims.
The UK Financial Services Compensation Scheme (FSCS) today announces that will start to issue decisions on London Capital & Finance (LCF) claims relating to misleading advice given to its customers before the end of May. The Scheme expects to complete the process of reviewing claims by the end of September.
Having completed a careful analysis of all the information it has gathered – amounting to close to a million pieces of information – FSCS has now started the process of reviewing individual claims. Once a decision has been reached on an individual claim, FSCS will send a letter to the customer to confirm the outcome, and if they are eligible for compensation, a cheque will be sent alongside.
FSCS explains that it has simplified the process by ensuring LCF customers do not need to submit a claim or provide any further information at this stage.
While FSCS is aware there are some customers who were given misleading advice, and will, therefore, be entitled to compensation, the Scheme still expects that a large proportion of LCF customers will not be eligible for compensation on this basis.
As FinanceFeeds has reported, FSCS said in February that it paid just under £2.7 million to 135 LCF customers in relation to 151 bonds. These bonds were invested following transfers out of stocks and shares ISAs.
The Scheme made these payments automatically, without these customers needing to make a claim themselves. FSCS explains that has been able to compensate this group of customers because arranging a transfer out of a stocks and shares ISA is a regulated activity.
LCF entered administration on January 30, 2019, and since then FSCS has investigated many alternative possible bases for claims. Around 11,600 bondholders purchased 16,700 bonds from LCF worth £237 million.