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FSCS rebates £73m of huge 2010 levy but rejects third of claims
by Sarah Miloudi on May 24, 2013 at 09:37
The Financial Services Compensation Scheme (FSCS) has approved rebates of close to £73 million relating to the additional interim levy for 2010/11 but rejected almost a third of all claims.
According to information obtained by Wealth Manager, the compensation scheme received almost 330 rebate requests linked to the levy, which covered the period when firms were hit with a £326 million bill.
In total, the FSCS approved payouts of £72.6 million, though it was asked to return £113.5 million, data released under the Freedom of Information Act said.
This amount is likely to have included the £5 million returned to Jupiter earlier this year after it paid £5.2 million into the scheme in 2010 to compensate individuals who lost out through the failure of a number of financial institutions, including Keydata.
Philip Johnson, Jupiter’s chief financial officer, said at the time the firm was pleased with the outcome, though surprised at the amount.
Among the less fortunate, however, were 226 firms, representing a gulf of just over £40 million between the total sum of rebates requested and those approved by the FSCS.
Last year, the compensation body said it would pay back just under £71 million to fund management and investment intermediary firms that had resubmitted their tariff data for 2010/11.
At the time it said money was still being returned to groups in the form of credit notes from the former regulator, the Financial Services Authority (FSA), so firms would have to wait until this year for the final claim.
The Financial Conduct Authority, which took on some of the FSA’s duties after it was wound down, was unable to say whether the firms involved were stockbrokers, wealth managers, fund managers, or a mix of all three, because the FSCS recorded the information based on how it raised the levies.
It said that of the total number of rebate requests received, 191 had come from firms that solely operated as fund managers, while 110 had been submitted by pure investment intermediation houses. Another 29 requests were from firms that fell into both categories, based on the permissions they held.
The news follows the FSCS’ decision in August last year to exempt income derived from funds from firm’s tariff data, which caused some firms to resubmit their data in the hope of clawing cash back.
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