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Positive Solutions among FSCS Keydata targets

Positive Solutions is among the firms being pursued by the Financial Services Compensation Scheme to recoup compensation paid to Keydata claimants.

Law firm Herbert Smith has written to Keydata distributors on behalf of the FSCS to kick-start the legal process of pursuing recoveries.

A letter to an undisclosed IFA firm, seen by Money Marketing, says the FSCS has claims against the firm on the grounds of negligence. It claims that the firm breached its duty of care to clients by advising them to invest in Keydata products.

Money Marketing understands the FSCS has written to dozens of firms to begin the recovery process, with individual claims against firms ranging from £500,000 to over £1m.

In January, the FSCS imposed a £326m interim levy on the industry, mainly to cover compensation costs after the Keydata collapse. Advisers paid £93m while fund firms paid £233m.

PosSol is among the firms to have received a letter from the FSCS’s lawyers. A spokeswoman at PosSol’s parent company Aegon declined to give any further details.

AWD Chase de Vere, which has upheld at least eight Keydata complaints, says it has not received a letter. Tenet also says it has not had a letter.

Sesame Bankhall Group dec-lined to comment on whether it has received a letter but a spokesman says: “Our research team never approved these products and it is rare for one of our members to choose a product that is not on our recommended list.”

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Comments

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

  1. Of course this should have happened – to all Keydata selling firms where clients have been compensated and it’s for their PI, etc.

    What is so, so wrong is that the FSCS went to the industry (and primarily the innocent) for the compensation FIRST when this proper route should have been the right one and to be frank, Keydata clients should have had to wait for compensation or funded against loans to FSCS against claims against advisory firms.

    Will the levy be refunded pound for pound in the end, to firms who suffered it?

  2. err excuse me… it was the FSA that was grossly negligent in approving keydata, the way it did in the first place.
    yet another example of the fsceless monolith in cahoots with the fscs… one could call it a cartel of regulation, the goliath against the davids so to speak.

  3. Good – we look forward to at least a partial rebate of our own levy paid in February 2011.

  4. Sesame Bankhall may not have approved these products but they were shareholders in Keydata. A fact which seems to have been missed by many people.

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