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700k claims loom as two firms default

Whitechurch Investment Services and Oaktree Financial Services have both been declared in default by the Financial Services Compensation Scheme.

Bristol-based WIS and Nottingham-based Oaktree are among 16 IFA firms declared in default. Both firms went into liquidation last year.

The FSCS says both firms have about 350,000 in compensation outstanding relating to about 35 claims although the claims have not yet been fully investigated.

It is believed that a large number of former WIS clients will make claims after the firm sold considerable numbers of precipice bonds.

Oaktree went into liquidation after discrepancies were noticed in the firm’s accounts.

WIS, which is part of Whitechurch Securities, went into liquidation on July 9, 2004 after making a loss for two years.

Bonds sold through the firm are thought to have ret-urned as little as half of the original capital.

Whitechurch managing dir-ector Kean Seager had pledged to take on the FSA if the firm was forced to write to all 900 WIS clients inviting them to claim compensation totalling 3m.

FSCS spokesman Suzette Brown says: “We have not looked into either of these firms fully yet and so the value of the claims against them could rise. These figures are just an estimate.”

Seager was unavailable for comment.

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