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900 Arch cru investors set for Capita legal action

Capita Financial Managers is facing a legal challenge from at least 900 Arch cru investors seeking compensation of almost £30m.

As the deadline approaches for investors to join a group litigation order against Capita, a steering group representing investors is urging wrap and platforms to contact further potential investors about the action.

A group litigation order was issued in October for investors who are not covered by the FCA’s consumer redress scheme to claim for losses resulting from Arch cru.

The order required Capita to provide Harcus Sinclair, the law firm representing the investors, with details of all investors who have not yet accepted compensation.

Now the Arch Cru Litigation Committee, a steering group which represents the interests of Arch cru investors, is writing to 40 wrap and platform providers including Skandia and Canada Life, asking them to pass on details of the litigation to all of their customers who invested in Arch cru.

Committee chairman John Hawkes says: “There are many investors in Arch cru out there who have no idea this litigation is an option for them. There may even be investors who do not know that they are actually invested in these funds.”

He says wrap and platform providers have an “obligation” to inform their clients about the action.

Harcus Sinclair says 900 investors have now joined the action, seeking compensation of almost £30m. This is almost double the number who had signed up to the action in November.

Investors have until 31 March 2014 to join the litigation process.

A spokeswoman for Capita says: “Any claims made against Capita Financial Managers will be vigorously defended and any such defence will be lodged through the appropriate channels at the relevant time.”

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Comments

There are 2 comments at the moment, we would love to hear your opinion too.

  1. E L Wisty (an only twin) 28th February 2014 at 10:57 am

    I sincerely hope that Capita does defend this action and that it goes to Court. If so, we will finally have an objective assessment as to the cause of investment losses and who is legally responsible. On the basis of the FSA’s own findings, Capita was in breach of a number of serious COLL obligations, which most reasoned observers would consider played a substantive part of allowing Arch’s various actions and ommissions that led to the losses.

    Should the Court find against Capita, then this should pave the way for a much larger civil liability action by advisers and insurers who had to shell out under the FSA’s rather self-serving Consumer Review.

    To my knowledge, the regulator may be an unaccountable bully (as far as IFAs are concerned) and can fetter the powers of the, so-called, independent Ombudsman; but it can’t tell a judge what to do. So we may finally have a number of important, but as yet unanswered, questions put to Capita, and possibly the FCA as a witness, in Court. Would’nt it be great if Sir Hector was also called to the witness box!

    Can’t wait!

  2. Test Comment MM 13.07

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