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Split-cap compensation delayed for month

Split-cap investors face further delays in their wait for compensation after Fund Distribution Limited said it will not pay out until the end of this month.

Compensation was due to be paid by Christmas but FDL says it has taken longer than expected to process the 40,000 applications it received.

Investors have been wait- ing more than a year for FDL to make them an offer. FDL has 144m to distribute and latest estimates suggest that investors should get around 50p for every 1 lost.

FDL was set up on Christmas Eve 2004 to make compensation payments and is being funded by the 20 firms involved in the split-cap crisis. Once it has made offers, investors must decide whether to take the money or pursue private lawsuits against providers.

FDL commissioner Mike Ellis says: “While we had planned to announce an offer before Christmas, FDL must be satisfied that it has completed all the necessary final checks before making an offer and this process is simply taking longer than expected.”

Innes Reid senior adviser Jim Turner says: “I have some sympathy with FDL as I assume it is probably short-staffed but this is unfortunate for those who were expecting compensation before Christmas.”

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