Advisers will pay out a total of £31m in compensation under the FCA’s Arch cru consumer redress scheme.
The FCA says 48 per cent of customers have opted into the scheme, and £8.3m has been paid out in redress so far.
In April 2013 the FCA launched its Arch cru consumer redress scheme, which required all firms which advised on Arch cru funds to write to affected clients inviting them to opt in to the scheme.
In December 2012, the FCA estimated that between 15 and 30 per cent of clients who were advised to invest in Arch cru would opt in to the scheme, reducing the redress paid out from an estimate of £110m for its initial scheme proposal – under which consumers did not have to opt-in – to between £20 and £40m.
In August 2013 the FCA reported that almost half of Arch cru investors had opted into the scheme.
Under the scheme, 3,414 sales have been reviewed by firms, of which 86 per cent have been found to be unsuitable.
FCA director of supervision Clive Adamson says: “The vast majority of firms have co-operated with us, helping ensure that this compensation scheme has progressed as smoothly as possible.
“We’re now seeing compensation flow to those investors who were missold. We will continue to monitor progress to ensure consumers affected by Arch cru receive redress as quickly as possible.”
In October the FCA raised concerns that opt-in rates for its Arch cru consumer redress scheme were considerably lower at some advice firms compared to others.
The regulator wrote to a sample of 30 adviser firms with low consumer opt-in rates asking them to explain why their opt-in rate was significantly below the industry average.
A spokesman for the FCA says: “We wrote to firms and some of their customers to make sure there was no reason why opt-in rates would be lower. We found nothing that caused us concern.”