The liquidator of BFS Investments is appealing to the High Court to allow it to pay split-cap compensation now rather than wait until the FSA completes its investigation into the firm.
BFS Investments, one of the firms at the centre of the split-cap collapse, went into liquidation in February. It is being investigated by the regulator as it did not join the £200m Funds Distribution Limited scheme to compensate investors.
Investors who lost out in the split-cap debacle were in line to receive about 30p in the pound but BFS’s liquidator, Grant Thornton, is barred from distributing compensation until the FSA has completed its investigation.
According to reports, Grant Thornton is so frustrated by the delay that it will ask the High Court this week for special dispensation to release cash to investors. It is understood to be concerned that investors will lose out more as the delay continues, adding to the legal bill and reducing the value of assets available for compensation.
Grant Thornton was unavailable for comment at the time of going to press.
An FSA spokesman says: “Our investigations are at an advanced stage.”