After the FSCS formally acknowledged that client claims related to funds held at the broker were likely to arise, further progress in distributing funds was dependent on the speed of claims collection by the special administrator appointed to service the Alpari UK bankruptcy, KPMG.
The announcement comes a month and a half after the FSCS acknowledged that the UK headquartered forex broker had entered into a special regime. As expected, the majority of the broker’s clients will remain unaffected, with only those who had deposited more than the insured deposit set at £50,000.
As previously reported by Forex Magnates, Alpari UK’s special administration process was still ongoing, with the latest news being that clients had begun to get access to the claims portal set up by KPMG.
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The FSCS will get information about confirmed claims from the Joint Special Administrators (JSAs) or KPMG. Customers of Alpari UK also have the option to submit their claim directly to the FSCS, but only after explicitly mentioning this intention in the JSA claims portal.
Clients of Alpari UK are currently being invited to submit their claims by email. With KPMG stating that over 100,000 individuals are entitled to claims, the drawbacks of the process have surfaced.
A very big portion of the Alpari UK’s accounts entitled to claims have a negligible amount on their balance, totaling to below any bank wire fees associated with the processing of a transaction. The procedure is excessively lengthy due to these practically unrecoverable funds also being included in the list of claims.
According to the announcement, the FSCS will be paying on the basis of account balances agreed upon by the JSA claims portal. If a person accepts FSCS compensation, his/her entire claim to the JSA will be transferred to FSCS, whereupon FSCS will receive any future JSA dividend that would otherwise have been paid in the case that the client is entitled to such.
Only clients who have claims totaling above £50,000 are entitled to dividends.