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Yorkshire Bank reviews £21m Ucis claims after FOS ruling

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Yorkshire Bank reviews £21m Ucis claims after FOS ruling

Yorkshire Bank is reviewing around 350 claims worth £21 million against it in relation to its role in failed property investment firm Arck LLP.

The bank operated as a depository for the investments and clients believed sums invested in the account were protected against any failure of Arck because they were segregated and ring fenced.

Around 750 clients invested £60 million with Arck, an unregulated collective investment scheme, into the segregated account with Yorkshire Bank but according to the Financial Services Authority from July 2011 the balance of the account was £25.

The bank did not respond to the claims in July 2012 when they were first lodged by law firm Regulatory Legal, which is representing Arck investors.

The solicitors took the complaints, then numbering 150, to the Financial Ombudsman Service in April. The Ombudsman reviewed them and ruled that they did not fall within its jurisdiction as the investors were not directly Yorkshire Bank clients.

The complaints were then resubmitted to Yorkshire Bank which is now conducting an internal review with a decision as to whether it will settle or contest the claims expected in October.

Michael Cotter, solicitor at Regulatory Legal, said: ‘They [Yorkshire] are conducting their own internal review after Regulatory Legal negotiated with the bank.’

Yorkshire Bank declined to comment.

Earlier this month the Financial Services Compensation Scheme (FSCS) said it was reviewing claims against advisers who placed client money into Arck.

Arck was placed into liquidation last year, and the FSCS said it was aware that investors had suffered ‘significant losses’.

The scheme said it was awaiting the results of a Serious Fraud Office investigation into Arck before determining the liability of adviser firms which sold the investment.

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