FSCS: Nothing definitive to report about London Capital & Finance

Maria Nikolova

The Compensation Scheme says it continues to investigate this complex matter.

The UK Financial Services Compensation Scheme (FSCS) has earlier today published the latest edition of “Outlook” where the body discusses updates that have taken place since it issued the previous edition in April this year.

The report features a brief notice about failed firm London Capital & Finance (LCF) with the comment by the Compensation Scheme providing little positive news to customers of LCF.

FSCS says:

“With regard to London Capital & Finance (LCF) there is not yet anything definitive to report as, working closely with the FCA and the administrators, we continue to investigate this complex matter. At the present time we cannot say what impact this may have upon levy numbers. We are keeping LCF customers updated and will of course keep you informed with our progress”.

As per the most recent FSCS update regarding LCF, the body has made some progress in gathering and examining information and evidence. This includes obtaining further records from Surge Financial Ltd of customers’ contact with them. The Scheme is also continuing to work with Smith & Williamson LLP, the joint administrators of LCF, to obtain further information to assist with its investigations.

FSCS believes that Surge, acting on behalf of LCF, provided some LCF clients with misleading advice, in both telephone calls and emails. The further records which have been shared with FSCS are set to help the body determine whether LCF customers are eligible for compensation.

Thousands of people have completed FSCS’s fact-finding questionnaire. The Scheme encourages the remaining LCF customers to complete the questionnaire. This will in no way prejudice any future claim they may have with FSCS.

Claiming with FSCS directly means a customer gets 100% of the compensation they are owed, up to a limit of £85,000, as the Scheme provides a free service to customers.

LCF, which was originally set up in July 2012 as a commercial finance provider to UK companies, sold mini-bonds from September 2013, with trading significantly increasing from 2015 onwards. As LCF only became fully authorised on June 7, 2016, FSCS protection can only apply in relation to regulated activity carried out after this date.

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