Keydata administration update

Category: Investments
Date: 6/9/2009

Investors with funds tied up in Keydata Investment Services Limited have been told that confirmation their money is safe will be delivered as soon as possible.

The assurance came from Dan Schwarzmann who is the joint administrator and partner of PricewaterhouseCoopers LLP.

Mr Schwarzmann said access to Keydata's information had only been available since Sunday evening and that the administration was in its early days. The main priority has been to assess the security of the investors' money and the nature of the assets in which the funds have been invested, he added.

Addressing the 85,000 investors affected by the situation, Mr Schwarzmann commented: "Our preliminary view, on the basis of the information we have seen so far, is that customers' funds have been held in secure custody accounts.

"We are still completing our investigations around the segregation of funds with our advisers and with Keydata. We hope to be able to confirm as soon as possible that customers' funds and assets are secure."

He went on to shed some light on the reasons the company had fallen into administration, revealing: "There are a number of Keydata products which may not comply with ISA regulations. The products we are currently aware of that fall into this category are Secure Income Bonds (SIB) issues 1-3 and Defined Income Plans (DIPs) issues 1-8.

"Tax liabilities arsing due to the non-compliance issues associated with these products is one of the factors which has led to the application by the FSA for the appointment of the administrators."