BDO enlists ARM investors to aid liquidation effort

The liquidators of the stricken ARM Asset Backed Securities life settlements fund have invited investors in the product to join an “ad hoc” committee to aid communication.

In a letter to bondholders Mark Shaw and Malcolm Cohen of BDO said they would be in regular dialogue with the committee to keep investors up to date with the liquidation of the fund. The committee will be elected by a vote at an investor meeting on February 3.

The FSCS has already promised to compensate investors who bought bonds backed by the fund through UK-based Catalyst Investment Group - a move which could cost advisers as much as £30m.

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However, the compensation scheme announced in December that payouts would be delayed until February or March, citing BDO’s need to gather more information, adding that this had been “complicated by the need to gather data from various additional sources”.

Separate investor action groups have been attempting to force the hand of the ARM board since it first ran into liquidity problems in 2011, demanding transparency on bids from third parties to rescue the portfolio. Since being appointed to liquidate ARM in October 2013, BDO has been posting weekly question-and-answer documents on its website for investors.