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Action group won’t sue IFAs

A newly formed Keydata action group has struck a deal with the Financial Services Compensation Scheme which allows members with eligible claims above the £48,000 limit to retain their rights to pursue recoveries against third parties.

Following a request from the Keydata SLS LSC Investors’ Trust Action Group, the FSCS has agreed to adapt its term of the payment of compensation to allow some group members to retain their rights against third parties rather than the FSCS taking full assignment, which would be the normal protocol.

The group, which was founded by investor Anthony Lahert, is backed by law firm Addleshaw Goddard and eight IFA companies, including AWD Chase de Vere.

It plans to pursue one or more institutional counterparties which had the job of safeguarding assets to recover funds, costs and accrued interest and will investigate parties advising or acting as agents on the transactions. But it has pledged not to pursue IFAs.

The group represents clients with Keydata secure income bond issues 1-3 invested in SLS Capital SA both through Isas/direct, as well as clients invested in SLS and Life Settlements Capital SA directly or through an IFA.

Around £103m of Keydata SLS assets, £150m direct SLS assets and £80m LSC assets are still missing.

The group says between 1 and 2 per cent of savers’ investments will be required to fund a legal investigation which is likely to cost over £1m.

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