Customers who invested in Lifemark-backed products through Keydata Investment Services will receive a final payment from the Financial Services Compensation Scheme.
The FSCS will send payments to customers whose losses exceeded the compensation limit. Customers with more than £30,000 invested when the failure occurred will receive a payment.
In November, Lifemark trustee PricewaterhouseCoopers announced that the final distribution to bondholders was paid.
The FSCS’s distribution will take account of all six of PwC’s distributions. This includes the final distribution the FSCS received in December 2015, which was around 1.5 per cent of the nominal value of issued bonds.
In a statement, the FSCS said it would make no further payments after this.
Keydata had originally distributed Lifemark bonds to the value of US$605m (£421m).
Following a court order, the FSCS announced in September 2013 that it would provide top-up payments to compensate early settling investors, and counter a disproportionate hit on compensation sums from £32m-worth of scheme administration fees.
Top-up payments were required to correct disparities in redress caused by its previous methodology, which based payments on the “compensatable amount” of any claim.
Darren Cooke, a chartered financial planner with Midlands-based Red Circle Financial Planning, said: “Anything like Keydata or Lifemark can only be bad news for advisers’ reputations, and put people off seeking advice.
“That is why people are driven to banks because they feel they are safe, although that is not always the case, as we have seen.”