Capita starts slow return of cash to Arch Cru investors

Capita is sending out cheques to Arch Cru investors as it starts the slow process of returning cash.

It has sent out the first payments from the funds today, but they only relate to cash holdings in the funds. Investors in the suspended funds will still have to wait for assets to be sold to recoup the rest of their money, a process that will take up to five years.

Capita wrote to investors at the weekend outlining the amount of money they would receive.

Investors in the largest fund, the flagship Arch Cru Investment Portfolio, will receive just 4.5% of their investment in the first round of payments.

Investors in some of the smaller funds will receive a bigger proportion of their investment back. Capita will pay out 32% from the Growth Fund, 27.5% from the Finance Fund, 20% from the Specialist Portfolio and 15% from both the Balanced and Income funds.

Tony Granger of Mentor Professional (pictured), who has clients in the Investment Portfolio, welcomed news of the payout. ‘It indicates they are doing something,’ he said, but he was still concerned about the huge drops in value the funds had suffered since suspension.

The letters reveal that the value of the funds has dropped slightly further since Capita's announced in December that they had lost up to 40% since suspension.

Capita is also due to meet early next month with law firm Regulatory Legal, which is representing advisers who have client money in the portfolios understands. Neither side would comment.

Regulatory Legal previously wrote to Capita stating it would pursue the company if advisers were hit by client complaints relating to the Arch Cru funds.

The payments to be made next week are part of the wind-up of the six Arch Cru funds, a process Capita says could take up to five years.