FSCS could pay out for 70 claims against IFA

FSCS could pay out for 70 claims against IFA

The Financial Services Compensation Scheme has confirmred it has reviewed new evidence from claimants and other third parties relating to investments in bonds backed by ARM Asset Backed Securities SA.

Since early 2014 the FSCS has been working through claims against Catalyst Investment Group Limited in relation to its role in promoting ARM bonds.

Compensation has been out for around 3,700 claims.

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Before the FSCS looked at claims against Catalyst, their staff considered whether failed independent financial advisers were liable for losses due to negligent advice to invest in ARM bonds.

The FSCS found that failed financial advisers were liable under “very limited circumstances” and as a result, a number of these claims were unsuccessful.

Many of the claims related to advice given by Rockingham Independent Limited, which was declared in default in 2012.

But now the FSCS stated it has revisited these claims and identified around 70 which may now be due compensation.

In particular, 70 claims have been identified as showing evidence that financial advisers failed to act on information they had at relevant times about the authorisation status of ARM.

The FSCS will now contact these people by the end of this month to confirm the scheme is reconsidering their claim.

Remaining customers with insufficient evidence will also be talked to again to check if they have any more iformation to support their claim in order to confirm the FSCS’ original decision to reject their claim still stands.

Claims where the claimant has already been fully compensated up to the FSCS investment limit of £50,000 will not be reassessed.