MPs will quiz the FSA next month on the size of its £54m Arch cru compensation package and the fact investors will be left having to claim against their IFA.
This week, Labour MP Tom Greatrex and Conservative MP Alun Cairns revealed they plan to lead an all-party Parliamentary group to lobby for 100 per cent compensation for Arch cru investors. This follows last week’s Parliamentary debate about the FSA’s compensation package, agreed between the regulator, Capita Finance Managers, BNY Mellon Trust and Depositary Ltd and HSBC Bank in June, which states anyone taking compensation must accept it as a full and final settlement against the firms.
Alongside distributions already made and remaining assets, investors should get back 70 per cent of their investment when the range was suspended in March 2009. Investors who feel they were missold the fund can pursue further claims against their IFA.
The FSA has agreed to meet with MPs on November 23 to discuss its stance on redress for Arch cru investors.
Parliamentary group co-chair Greatrex says: “It is unfair for IFAs to be landed with this. Everything I have seen points to the problem being elsewhere and IFAs are probably in the worst position to pay redress.”
Conservative MP and the group’s secretary Guy Opperman says: “This was marketed as a safe, cautious fund ideal for a pension transfer. I fail to see what IFAs have done wrong. If the FSA thinks IFAs are to blame, it must explain what the basis of that is.”
An FSA spokeswoman confirmed the meeting but declined to comment further.
Dennehy Weller managing director Brian Dennehy says: “The firms involved in the compensation package should admit they messed up and pay the whole bill.”