EEA Fund Management has hit out against a letter warning investors in the suspended Life Settlements fund that they must file their redemption requests soon or risk not getting their money back.
There is a six-month window for payments to be made but requests must be filed by 28 December.
The warning, issued by EEA Investors’ Group, said the firm will be able to reinvest all unclaimed assets into other instruments.
According to the key questions document updated by EEA in November, cash will not be put back into another scheme while there are relevant outstanding redemption requests.
David Trinkwon, who helped set up the action group, said holders of more than 870,000 continuing shares valued at more than $90 million (£67.5 million) are yet to request redemption and could miss the chance to get their money back.
‘EEA are within $10 million of being able to satisfy all existing requests,’ he said.
According to the action group, EEA is negotiating to sell off the remaining life insurance policies in the portfolio to Coventry Capital, releasing more than $250 million of cash for all remaining investors.
However, last month it was revealed that Coventry Capital had filed a suit against EEA in the US, alleging the firm had thwarted its efforts to buy the portfolio.
An EEA spokesperson said: ‘We remain concerned that ill-informed allegations are being circulated. They can cause unnecessary alarm and anxiety to some shareholders and risk, amongst other things, having an adverse effect on the sale prices of policies.
‘The fund and manager strongly dispute any suggestion that the fund is not being handled properly or in investors’ interests.’
The fund has been returning money to shareholders on a regular basis, with the latest distribution totalling £4.3 million.
It suspended redemptions in 2011 following a wave of withdrawal requests after the Financial Services Authority branded life settlement funds ‘toxic’.