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Split-cap victims get forms to claim redress

Fund Distribution has begun sending application forms to investors who may be eligible for compensation over the split-cap debacle.

It expects forms to be with investors by next week and has set a deadline of 4.30pm on July 18 for forms to be returned.

The company was set up in December to make payments to investors who suffered a loss in some zero-dividend preference shares and other shares that invested heavily in zeros.

Contributions to the fund from fund firms, banks and brokers now total 144m.

Fund Distribution expects to get around 50,000 applications for compensation. These will be processed over the summer and offers made in the autumn. Investors will have a month to consider whether to accept or reject offers, which Fund Distribution hopes to pay out by the end of this year.

Investors accepting offers will have to waive rights to pursue existing and future claims in respect of the investments specified in the offer.

After initial payments have been made, if any balance remains in the fund next January, then further payments could be made to investors.

Fund Distribution commissioner Mike Ellis says: “These application forms are not something that should sit on the mantlepiece too long. We urge investors to complete their applications as quickly as possible.”

Equal Partners managing director Vivienne Starkey says: “There was sufficient doubt about the way companies had behaved to force them to pay into the fund. It is, however, probably the best solution to come out of the crisis because people who were going to get nothing will at least get something.”

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