FSCS confirms Midas Financial Solutions operated Ponzi scheme
The UK Financial Services Compensation Scheme has completed its investigation into Midas and can confirm that the firm does owe a civil liability to customers.
Less than a fortnight after the UK Financial Services Compensation Scheme (FSCS) informed the victims of Midas Financial Solutions (Scotland) that they may be eligible for compensation, the body has confirmed that Midas had been operating an illegal or so-called ‘Ponzi’ scheme.
FSCS says it has completed its investigation into Midas and can confirm that the firm does owe a civil liability to customers.
FSCS has been working with the Financial Conduct Authority (FCA) who have provided it with contact details of some of the investors in relation to the ‘Midas Scheme’. This means that FSCS is able to determine and pay the compensation owed to these investors without needing them to submit an application to FSCS. The body is now contacting these investors so they can be informed of the next steps.
If you believe you have been a victim of the Midas Scheme (relating to high yield, short term deposits) please wait to receive a letter. FSCS expects letters to be with investors by 20 March.
In February this year, FSCS said it was investigating the activities of Midas and, in particular, advice given to customers to invest in high-interest short term deposit accounts. The investments were touted as carrying attractive guaranteed returns placed on favourable terms due to the owner’s relationship with a well-known high street bank.
In reality, however, the high-interest accounts had never existed. Instead, investors’ money was placed into a so-called ‘Ponzi Scheme’ operated by the owner of Midas.
