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Lifemark looks to stop income on Keydata plans

Lifemark has submitted an application to the Luxembourg regulator to change the terms and conditions of existing Lifemark bonds to zero coupon bonds which would no longer oblige them to provide interest payments.  

The bonds underpin a number of plans provided and administered by Keydata Investment Services.

The Commission de Surveillance du Secteur Financier is considering the proposal from Lifemark’s board of directors to restructure the firm’s debt which was submitted on January 31. Today it suspended the Lifemark securities from trading on the Luxembourg Stock Exchange. 

In an update today the CSSF says: “This proposal would, if accepted by the CSSF, be forwarded to the trustee who will be asked to waive immediate coupon payments for the bonds and eventually arrange for the bondholders to vote on the debt restructuring proposed by the board.”

In a FSA update, the regulator says the CSSF will consider whether the proposal will ensure that investors’ monies are recovered or whether it would be in their best interests to pursue liquidation under Luxembourg securitisation law. 

Investors have experienced ongoing delays with Keydata plans invested with Lifemark of which there is approximately £349m invested. In November KPMG was appointed provisional administrator as an oversight appointment for “auditing, initiative and investigation.”

It is understood that Keydata founder Stewart Ford set up Lifemark with other business associates and he remains a shareholder.

Further updates will be published on the FSA website. 

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Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. Lifemark has been in default of it’s obligations. Isn’t about time the whole thing was wound up and assetts distributed to planholders. The vasy majority of plan holders are invested for income. If they can’t get the income from the plan then they should have their cash returned to buy an alternative means of obtaining their income and do it quickly before PWC can take all the money in fees

  2. Ford said he “planned to bridge the liquidity gap by taking money from new Lifemark customers and using it to pay existing investors”.

    A graduate from the Madoff school of investment?

  3. To Anonymous: If only it were that simple. We have been told that there is no market for the underlying assets (that’s why the liquidity problem exists, I think). And all our cash – supposed to be 30% of the fund – has long gone. Winding up Lifemark would mean very large losses of our capital. So the dilemma is: Do we lake the crumbs from the liquidation table(after PWC/KPMG etc have had their fill)? Or do we accept that our retirement income is lost, and hope that there will be something left for our heirs in 10 years time? I think I’ll talk to Terry Pratchett about the third option.

  4. I think that it is appalling that Keydata approved by the FSA should get into this mess and now the FSA do not want to know the government said save your money do ndt piss it up the wall I wish I had David

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