Split-cap firm BFS Investments has been declared in default by the Financial Services Compensation Scheme meaning consumers can now claim against it.
The FSCS says the decision follows extensive enquires into BFS funds and potential bases of claims which led it to rule the firm is unable, or likely to be unable, to pay compensation claims against it.
The FSCS says it expects to deal with claims in relation to the individual trusts it managed, its role as an execution-only portfolio manager and its role as a discretionary portfolio manager.
The scheme has sent out 4,200 questionnaires to BFS clients to assess who could qualify for compensation and how much. It expects to deal with most claims within nine months.
It has already announced that a split-cap levy will be introduced next year to pay for claims arising from BFS and Exeter Fund Managers. Exeter was declared in default in May.
FSCS chief executive Loretta Minghella says: “Declaring BFS Investments Plc in default means that we are now ready to consider claims from investors who may have lost money as a result of investing in certain BFS split capital investment trusts.
“We are aiming to deal with these claims as quickly as possible. Some straightforward claims may be completed in a matter of weeks while the more complicated ones are likely to take longer.”