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FSCS delays Keydata payments again

FSCS delays Keydata payments again

The Financial Services Compensation Scheme (FSCS) has again delayed payouts to investors in Lifemark-backed Keydata products.

The scheme had originally told investors it expected to pay the majority of claimants with losses of more than £30,000 in mid-April.

However at the end of April it said these payments would be delayed until May due to delays in its calculations. The FSCS has now updated investors and said payments would be sent in early July.

it said: ‘Due to a further delay in finalising the payment calculation process, the FSCS was unable to make the balancing and distribution payments in May as it anticipated. We apologise for any inconvenience this may have caused.’

‘We are pleased to confirm the calculations have now been finalised and we are able to start making payments to the majority of claimants in early July.’

The FSCS took on a stake in Lifemark, the Luxembourg fund that underpinned a series of Keydata policies, following the collapse of Keydata in June 2009. That collapse triggered around £250 million of FSCS payments related to Lifemark-backed Keydata policies.

It has previously paid out to investors in September 2013 and January 2014.

It also announced it was continuing to work with administrators of London-based investment firm Hartmann Capital to make compensation payments as soon as possible to clients.

The firm was put into administration in 3 January 2014, a day after the Financial Conduct Authority clamped down on the firm after being alerted to a £1.5 million shortfall in its client monies and a £1.2 shortfall in regulatory capital.

It ruled that the firm could no longer carry out regulated business, except in settlement of certain transactions in non-derivative financial instruments. It also ruled it could not deal with client money.

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