FSCS pays £1m to Cornerstone clients

FSCS pays £1m to Cornerstone clients

Customers of Cornerstone Friendly Society have received almost £1m in compensation from the Financial Services Compensation Scheme (FSCS) to date.

In its latest update, the FSCS stated to have paid £950,000 to 44 of the liquidated firm’s customers since it found the company to be in default in May 2017.

Cornerstone Friendly Society went into liquidation in June 2015, following a court application from the Prudential Regulation Authority (PRA) in April the same year. 

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At the time of liquidation, the West Yorkshire and Humber regional fraud team investigated Cornerstone in connection with fraud and money laundering allegations regarding pension investments.

Prior to the investigation, transfers to Cornerstone were blocked by self-invested personal pension firms amid concerns over alleged pension liberation activity.

Ten people were arrested and released on bail at the time of the investigation.

The FSCS liaised with the PRA, liquidators, regulators and the West Yorkshire Police to reach its default decision.

According to the FCA register, Cornerstone is in liquidation and has stopped taking on new business but is still authorised by the regulator.