The Financial Services Compensation Scheme has passed all claims against failed discretionary fund manager Strand Capital Limited to its claims processing teams for assessment. The FSCS added that decisions on these claims would be sent out shortly.
In an update on its website, the lifeboat scheme said it was aware that some Strand customers were advised by independent financial advisers to transfer existing assets to the firm that was put into special administration in May 2017.
Following this transfer, clients had their funds placed in high risk, non-standard investments, some of which have become illiquid.
As such, clients who were advised by an authorized adviser to transfer their money to invest with Strand Capital will need to complain to the adviser before the FSCS can consider their claim.
Royal C Bank on Why Crypto is Still the Name of the GameGo to article >>
However, if a customer was advised by an FCA-authorised adviser that is no longer trading, then they must first submit a claim to the FSCS against the adviser.
FSCS compensates up to the £50,000 limit
“As we outlined in our previous update, we’re aware that FCA authorised advisers may have recommended customers invest with Strand Capital Ltd. Or they may have recommended transferring existing pensions or investments through a self-invested personal pension (SIPP),” the FSCS explains.
Strand Capital went into administration two years ago, and nearly 2,500 clients holding investments with the company were told by the FSCS that they would have their investments returned in full.
The administrators secured court approval for their distribution plan, and the fund has paid out £5.7 million so far to nearly 800 customers through its self-invested personal pension — the payments related to client cash only.
The FSCS says it will continue to work with the joint special administrators of Strand so that customers get back their assets as soon as possible. Since the reconciliation of client cash has not yet been completed, and shortfalls have yet to be finalized, the FSCS will step in to compensate clients, up to the £50,000 limit.