Citywire printed articles sponsored by:
View the article online at http://citywire.co.uk/new-model-adviser/article/a404913
FSCS refuses to explain why it rejected Keydata claim
by Iain Martin on Jun 08, 2010 at 08:00
The Financial Services Compensation Scheme (FSCS) has refused to release evidence justifying why it rejected a claim from a consumer who bought a Keydata Secure Income bond.
The FSCS told Gareth Fatchett (pictured), partner at Regulatory Legal, it had no obligation to give information on why it would not compensate a client for money misappropriated from SLS Capital, which underpinned the Keydata bond.
FSCS head of legal James Darbyshire said there was no link between the disappearance of the £103 million and Keydata. Investors instead needed to prove they had relied on a fraudulent misrepresentation made by Keydata to claim compensation for non-ISA wrapped Secure Income bonds. Darbyshire dismissed Regulatory Legal’s attempt to launch a judicial review of its decision as an ‘unfocused fishing expedition’.
Darbyshire also rejected Fatchett’s application, which is the first step in a judicial review, because it was sent via email rather than through the post.
Fatchett has also applied for a judicial review of the £80 million FSCS interim levy, which was imposed on investment intermediaries in order to cover Keydata payouts. The FSCS has drawn fire for only paying compensation to consumers with ISA-wrapped secure income bonds because the product was not eligible for ISA status.
Prev Close:
More FTSE charts & pricesPrev Close:
More FTSE charts & pricesPrev Close:
More FTSE charts & pricesNews sponsored by:
Today's top headlines
More about this article:
More from us
- Liquidation looms as Lifemark funding deadline hits
- Stewart Ford blames FSA for Keydata collapse
- Is Gareth Fatchett biting the hand that feeds him?
- N&P hands Keydata investors £2m loan lifeline
- Regulatory Legal turns on N&P IFA in Keydata battle
6 comments so far. Why not have your say?
Julian Stevens
Jun 08, 2010 at 12:48
It seems the FSCS is no more open or transparent than the FSA (despite what the FSA claims on its website). And still we pay, we pay, we pay.
report thisNameless
Jun 08, 2010 at 13:05
This was NOT an investment loss. It was a failure on the part of the custodian bank in the original literature to ensure they either had legal title for the investments made or cash sitting in the bank accounts for what was sold.
Whether it is the FSCS who are liable or not, consumers and adviser need to know that the correct party is being looked at for the failure further up the food chain to check what's a bit like a chain of evidence/custody. Someone has failed in a duty, not just the criminal in this case and it seems to me the victims are having to try and claim against everyone as the Regulatory system is hiding the truth.... could it be that there is complicity?
Even Stewart Ford's comments have a ring of some truths.... who is anyone supposed to believe when the whole thing is being hidden?
report thisDave Greenhill
Jun 08, 2010 at 14:31
I thought that (on payment af a token admin fee) anyone had the absolute right to see all data in relation to themselves?
Or is the Data Protection Act along with it's individual licencing fees yet another bit of expensively useless legislation?
My advice? Tell any affected investor to demand access to their file, pay their £10 fee (or whatever) and pass that information on to someone who knows the rules so that if there is a case to answer, it can be led effectively.
report thisRevohtron
Jun 08, 2010 at 15:37
Eh? "no link between Keydata and the disappearance of £105 million...take me through that one.
That means that as the Director of a regulated company, I can claim that there is no link between me and an advisor who dishes out bad advice or who misappropriates clients funds. Dream on.
FSCS are breaking that link, so that they don't have to hand over any cash.
Any further information would allow action against them, so they keep quiet. When Stewart Ford didn't want anybody to play on his computer, everybody thought that he had something to hide. Now, we mere servile mortals start to wonder about the clandestine goings on, in the FSCS.
report thisBanged to Rights
Jun 09, 2010 at 10:59
F pack - Under pressure
report thissimon schuster
Jun 09, 2010 at 12:40
can anyone explain why PWC was appointed the administrator of Keydata, when they were also the auditors of Lifemark, and the Fraudlent SLS Capital?
Are the FSCS, FSA and PWC all trying to cover up their complicity in this mess?
report thisleave a comment
Please sign in here or register here to comment. It is free to register and only takes a minute or two.