Yorkshire Bank agrees to support Arck investors

The FCA said that Yorkshire Bank had offered investors in certain Arck schemes recompense, but emphasised that the bank should not be held responsible for Arck’s failures.

Arck entered liquidation in February 2012 after losing approximately £45m of investors’ money, with investors seeing little or no returns. The FCA said the firm had used IFAs to market unregulated property development investments either directly or through Sipps, offering “high returns with no risk to capital” to roughly 700 investors between 2006 and 2011.

Yorkshire Bank did not offer, introduce or sell investments with Arck, but did provide bank accounts for them.

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The FCA said: “Investors claim to have lost their investment as a result of an alleged fraud perpetrated by Arck, but have been seeking redress either directly from Yorkshire Bank and/or from Arck via a claim in its liquidation.”

David Thorburn, chief executive of Clydesdale and Yorkshire Banks, said: “Arck falsely represented our position. We could not have provided the protection it implied. But we believe it is right to support those who invested on the strength of our brand and the protection they believed they were getting.

“The approach we have agreed with the FCA is a positive step; providing an opportunity for a quicker resolution for many of the investors, while we seek to recover the funds through other avenues.

“A number of criminal and civil investigations are ongoing in relation to the failure of both Arck and HD Administrators, the Sipp provider which sold some of its investments.”

Adviser view

Julian Pruggmayer, director at Wolverhampton-based adviser Financial Risk Management, said: “It’s better than a smack in the teeth for those Arck members who do see some money back, but it is not going to change anything. This industry has stumbled from crisis to crisis, because we have the same people in charge at the FCA that were at the FSA before – the buck should stop with them.”