FSCS probes fallen IFA over property advice claims
Compensation scheme says it is satisfied firm cannot pay eligible claims following liquidation.
The Financial Services Compensation Scheme has announced that it is launching an investigation into advice given by collapsed IFA firm Bentley Leek, in order to establish whether to declare the firm officially in default and process claims.
According to a statement on the FSCS wesbite, the London-based advisory and investment firm was placed in creditors voluntary liquidation in November 2011.
The company hit headlines in the trade press in 2011 over failed property investments in both the UK and Dubai, which were hit by continuing delays and financing issues that threatened to wipe out investors’ eight-figure aggregated commitment.
In its statement FSCS says it is “satisfied Bentley Leek is unable, or likely to be unable, to pay claims”, but that it must verify whether eligible claims exist before it officially declares the firm in default.
If claims are identified, claims will likely fall within the investment intermediary sub-sector, raising the spectre of further costs for firms.
FSCS adds it is FSCS is considering whether there may be valid claims against Bentley Leek for advice it gave in relation to various property-backed ventures and whether we may be able to pay compensation in relation to those claims.
“Although we are not able to say at this time how long our investigations will take, we will provide further updates on significant developments as they occur.
“If we are able to accept claims, we will then provide customers of Bentley Leek with information about how to make a claim for compensation.”