FSCS Paid $56.3 Million to London Capital & Finance Victims

The United Kingdom’s Financial Services Compensation Scheme (FSCS) announced on Thursday that it has paid over £56.3 million in compensation to 2,878 bondholders of the collapsed company, London Capital & Finance (LCF).

The compensated bondholders of the minibond provider held 3,815 LCF bonds. This followed the previous update about the compensation a couple of months ago when the FSCS distributed more than £50.9 million to LCF investors.

“We are close to having identified and paid all LCF customers who we believe are eligible for FSCS compensation,” the latest update noted. “It has taken longer than we anticipated, as we have continued to identify and analyze more evidence, which could result in us protecting more customers. We remain committed to ensuring that each piece of evidence and each claim gets the attention it deserves.”

Only a Fraction of the Losses Were Compensated

The LCF collapsed in 2019, affecting around 12,000 investors, who suffered a combined loss of £236 million. The compensated amount is only a fraction of the total loss.

While the principal number of victims are still waiting to receive compensation, the FSCS urged them to remain optimistic as the review of the claim is still ongoing.

Earlier, the FSCS revealed that it reviewed almost a million pieces of evidence to determine who were the misled customers of the collapsed minibond provider. Furthermore, it used artificial intelligence to review 700,000 phone recordings.

“Those LCF customers who are still waiting for a decision do not need to contact us or take any action at this stage. Once our review of claims is complete we will await the outcome of the Judicial Review on LCF before confirming the next steps for those LCF customers who have not received FSCS compensation,” the compensation agency added.