FSCS investigations reveal protected claims that may result in compensation for some LCF investors
- After reviewing LCF business practices, including the role of Surge Financial Ltd (Surge), which was acting on behalf of LCF, FSCS has concluded that, in some cases, misleading advice was provided to customers
- Advising is a regulated activity for which FSCS may pay compensation
- Further investigations are needed to establish the exact nature of this advising and how many customers this will impact – this will take a number of months
- In the meantime, FSCS is inviting LCF customers to complete a pre-application questionnaire to help them better understand the facts of investors’ cases
- It is too early to say what the amount of compensation or the impact on levy-payers will be
The Financial Services Compensation Scheme (FSCS) has today announced that its investigation into London Capital & Finance (LCF) leads it to believe there are protected claims that may result in compensation for some of its investors.
Following an extensive review of LCF’s business practices, FSCS believes that Surge Financial Ltd, acting on behalf of LCF, provided a number of LCF clients with misleading advice. As this is a regulated activity, this means FSCS protection would be triggered and that there may therefore be customers with eligible claims for compensation.
At this stage though, FSCS does not have access to all the information needed to determine the nature and extent of this misleading advice and is still working with the relevant parties on gaining access to this.
FSCS has therefore launched a pre-application questionnaire on its website for investors to complete in order to help build a better picture of this advising. The information gathered through this process will help FSCS better understand individual investors’ circumstances and therefore the number of customers that may have been impacted.
A spokesperson for FSCS stated:
“Throughout our investigation into LCF we have been as transparent as possible so that both LCF investors and our levy payers know where they stand. Having established that there are customers who were given misleading advice and therefore may be eligible for compensation, we now need to determine the full extent of this advising activity.
“We would therefore urge LCF investors to complete the pre-application questionnaire on our website as this will help us enormously in the next stage of our investigation. We expect this will take a number of months, but we will do all we can to come to a decision as quickly as possible.
“If we do start accepting claims, it is important for investors to remember that if they come to us directly there will be no charge to pay as we are a completely free service.”
James Tweed - T: 020 7375 8646
Anthony Ozimic - T: 020 7375 8638
Catherine Goodier - T: 020 7375 8631
Notes for editors
Read more about the remit of FSCS on our Notes for editors page.
Latest News from
How we helped over 2,000 customers in four days27/04/2020 17:05:00
See the numbers behind FSCS COVID-19 measures.
FSCS allocation of claims regarding IFAs and SIPP operators09/03/2020 12:38:00
When customers suffer losses as a result of failed investments made via a SIPP there are often a number of different firms which may be liable for some or all of those losses.
FSCS clarification – July 2019 monthly defaults press release - Assura Protect Ltd27/01/2020 16:20:00
FSCS wishes to clarify that Assura Protect Limited of 86 Gloucester Place, London W1U 6HP has not been declared in default by FSCS and we understand is still trading and remains Authorised under FRN 678817 by the Financial Conduct Authority.
Quick Sure Insurance Company Ltd has failed27/01/2020 13:48:00
Quick Sure Insurance Ltd, a Gibraltar-based insurance company, was declared in default recently (Friday 24 January 2020) by the Financial Services Compensation Scheme (FSCS).
Plan and Budget20/01/2020 12:25:00
FSCS Plan and Budget outlines expected management costs and the latest forecast of potential claims volumes. Also outlined are initial forecasts for the levy financial services firms will pay next year, as well as any supplementary levy that may be due.
FSCS announces its annual Plan and Budget 2020/2116/01/2020 16:20:00
Compensation scheme announces indicative levy of £635m and management expenses budget of £78.2m for 2020/21 in its Plan & Budget
FSCS announces decision on LCF claims09/01/2020 13:25:00
The Financial Services Compensation Scheme (FSCS) today announces key decisions for claims in relation to the London Capital and Finance (LCF) failure.
Mail Online, This is Money & FSCS06/01/2020 14:10:00
FSCS, the Mail Online and This is Money have joined forces to produce a series of podcasts and articles. They all have one purpose – to help you keep your money safe.