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EEA fund suspended after wave of redemptions
by Jun Merrett on Dec 01, 2011 at 10:31
The EEA Life Settlements Fund has been suspended after a wave of redemptions from investors.
A statement from the board of directors of the fund said the FSA's intervention in the life settlement market had led to cancelled subscriptions and redemption requests from investors that were 'significantly above normal redemption levels'.
'As the current liquidity levels of the fund are insufficient to satisfy such redemption requests in full and the board has determined that it is not reasonably practicable to realise or dispose of its investments to satisfy such requests, the board has decided to suspend dealings.'
It added that the suspension would not affect the fund's ability to pay premiums on insurance policies.
The FSA earlier this week announced its plans to ban traded life policy investments (TLPIs) from being marketed to UK retail investors, branding them 'high risk, toxic products'.
The regulator's managing director Margaret Cole said past failure of the some life settlement products had led to 'significant consumer detriment'.
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