People who bought Lehman backed structured products from three UK firms that have been declared default by the Financial Services Authority (FSA) will soon be compensated.
The Financial Services Compensation Scheme (FSCS) can now start paying eligible claims that it receives against NDF Administration Limited (NDF), Defined Returns Limited (DRL) and Arc Capital and Income plc (Arc) relating to structured products sold by the firms.
Products sold by the businesses have been split into two groups by the FSCS – Capital Secure Products and Capital At Risk Products. The Capital Secure products that are though to have been mis-sold by the three companies include:
Around 1,700 investors with Capital Secure products will be sent application forms by the end of the month, with an aim of paying most eligible claims within six months of receiving a completed application form and supporting information.
The FSCS said it is still investigating the position of investors who hold Capital At Risk Products and is not yet in a position to receive compensation claims. Investors will be updated when the investigation is concluded.
Investments defined as Capital At Risk include:
"We have been working closely with the FSA and the administrators of all three firms to establish where we may be able to help" Loretta Minghella, FSCS chief executive, said.
"We are pleased to say that we are now able to send application forms to investors with Capital Secure products and will start making payments to eligible claimants as soon as the application forms are returned to us.
"Meanwhile, we are doing everything we can to complete our investigations into the Capital At Risk products as quickly as possible."
Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.
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