Law firm Foot Anstey has set out plans for how it will look to fight the FSA’s Arch cru redress scheme.
In an email sent to advisers who expressed interest in joining a pressure group set up by the law firm, Foot Anstey says it will instruct a barrister to scrutinise the FSA’s consultation into how to compensate Arch cru investors.
The move comes as Aifa urges advisers to respond to the FSA’s consultation on the scheme to express concerns over the effect of the proposal on the IFA industry and consumers.
Foot Anstey will examine the rationale behind the £54m redress scheme funded by Capita, HSBC and BNY Melon and why the amount is not higher. The law firm will express the view that the products were faulty.
Once the barrister has examined these issues, Foot Anstey says it will contact the regulator to engage in the current consultation process.
Currently, 106 advisers have expressed an interest in joining the pressure group. Foot Anstey are asking those interested to contribute £750 per adviser in order to join.
The letter says: “We remind you that the purpose of the pressure group is collectively to act together and to engage in the consultation process with the FSA with a view to persuading them to reconsider the proposals set out in their consultation paper.”
In April, the FSA launched a three month consultation into establishing a consumer redress scheme to compensate Arch cru investors.
If the scheme is set up all firms which sold Arch cru funds would have to contact clients to let them know if their case falls within the remit of the scheme within four weeks.
Aifa policy director Chris Hannant (pictured) says: “We have deep concerns about the proposed redress scheme and this apparent retrospective application of standards. The FSA must also explain why a redress scheme is necessary and why it has dismissed the other options for consumer redress.
“Consumers have not been left in the lurch – they have the power to seek redress now. The FSA’s power to develop redress schemes was granted in order to tackle issues of industry wide systemic risk, such as PPI. It was not intended to be used for a single regulated entity such as Arch Cru. A redress scheme, in this instance, is therefore inappropriate and threatens to damage the long-term sustainability of the profession.”
Advisers can respond to the consultation through the following email address: firstname.lastname@example.org