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Standard Life criticised over Arch Cru offer silence

Regulatory Legal has accused third party providers of Arch Cru investments of being slow to act in sending out offer letters to investors.

On 31 August, the Financial Services Authority announced a £54m redress package after reaching agreement with Capita, BNY Mellon and HSBC, which would entitle investors to 70 per cent of of their investment at the time of the funds’ suspension. Commentators, however, have speculated that final offers may not even come to 50 per cent.

Law firm Regulatory Legal believes that “over 1,000” of its investor clients, on behalf of whom it has set up a steering group to push for a judicial review into the package, are still awaiting their financial offer from third party providers who sold Arch Cru.

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In particular, the firm highlighted clients that invested through the Standard Life, Sanlam and Transact platforms.

Standard Life has confirmed that it has not yet sent out offers to investors, while Sanlam said it was sending offers this week and Transact says that it sent out its offers to investors in mid-November.

Standard Life told FTAdviser that the reason why it’s offer letters have not been sent out yet is because there are “different obligations for individual investors”.

A spokesperson for Standard Life said: “We have been working though the individual circumstances of each client and pulling together a communication with personalised application pack for each customer, which we will be issuing in the near future.”

Sanlam Investments and Pensions, formerly Merchant Investors, said they were writing to investors this week.

A spokesperson for Sanlam said: “We are writing to investors week ending 25 November 2011 in order to communicate the personalised offer of payment under the payment scheme that has been established by the contributing parties for settlement of claims in respect of investment in the CF Arch cru funds.

“We will seek instructions from investors about whether or not they would like us to accept that part of the offer relating to their interest in the CF Arch cru funds”.

Transact is the only one of the three named platforms that has already sent out offer letters. In September it wrote to investors to alert them to the offer, following this up with a letter in November setting out the terms of the Arch Cru payment scheme.

If investors accept payment under Transact’s payment scheme, Transact will be paying investors on a four-weekly rolling basis so that they do not have to issue all payments towards the end of the 31 December 2012 deadline.

Gareth Fatchett, director at Regulatory Legal, said: “Third party providers need to get their fingers out. They are being paid to handle investments on behalf of our clients. Investors have some serious decisions to make [and] this is hardly helping things.”