You might be eligible for compensation
FSCS is aware that B&G Finance Ltd entered administration on 1 April. FSCS is ready to start accepting claims against the firm.
From 2 January 2018 B&G Finance Ltd was authorised by the FCA, and from 1 March 2018, it arranged and promoted mini-bonds on behalf of Basset & Gold plc, which issued the mini-bonds. FSCS has determined that due to mis-selling of these mini-bonds, many Basset & Gold bondholders who bought their mini-bonds through B&G Finance Ltd may be able to claim compensation up to the £85,000 limit.
Although Basset & Gold Plc has also entered administration, FSCS is unlikely to be able to pay compensation based purely on Basset & Gold Plc’s failure to repay the bonds, as issuing bonds is not normally a regulated activity.
Customers who bought their bonds through B&G Finance Ltd can submit a claim directly to FSCS.
For FSCS to be able to pay compensation, the customer must have been mis-sold their bonds, for example, because they relied on a misleading statement about how Basset & Gold Plc was investing their money. FSCS will also check which firm was responsible for the sale of the bonds.
FSCS is investigating possible mis-selling of the mini-bonds by other related firms prior to 1 March 2018.
We will provide further updates on this page as information becomes available.
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13 Nov, 2020
Since our previous update in August, we have now completed our investigation into B&G Finance Ltd.
We have now moved all claims submitted to our claims processing teams for assessment.
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14 Aug, 2020
Since our previous update, we have been reviewing the information received from the administrators. We've been examining if B&G Finance owes a civil liability to customers that would enable them to sue the firm in court.
We have determined that B&G Finance may have mis-sold Basset and Gold plc mini-bonds to retail customers from 1 March 2018. While this investigation may share similarities with London Capital & Finance, B&G Finance Ltd operated under a different structure. It did not issue its own bonds but arranged for customers to buy bonds issued by a different firm.
LCF issued its own bonds - which we consider is not a regulated activity - whereas B&G Finance Ltd carried out the regulated activity of arranging. Because the other requirements under our rules are also met, we may be able to protect many customers of B&G Finance Ltd.
We have now moved into the final stages of our investigation and we will start to process in phases the claims received so far. We can’t confirm when we will be looking at any one individual claim as we need to contact customers for further information.
However, as soon as our investigation is complete, we will move all submitted claims to our claims processing teams for assessment.
As outlined in previous updates, we are aware that principal firms have provided guidance to customers that were mis-sold their B&G mini-bond between 31 October 2016 - 1 March 2018.
If a customer ‘rolled over’ their investment after 1 March 2018, FSCS will consider their claim against B&G Finance Ltd. For clarity, a roll-over investment would have occurred at the end of a customer’s investment period, where the money was reinvested with Basset & Gold, through B&G Finance Ltd from 1 March 2018.
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17 Jun, 2020
Since the failure of B&G Finance Ltd in April 2020, FSCS has been working closely with the administrators. Together we're trying to understand the history of arranging and mis-selling of mini-bonds carried out by B&G Finance.
Several related firms carried out different activities during different periods of time. Some of these were regulated and some not. We have now received further information from the administrators that will assist in substantiating claims against the correct regulated firm. Once we've reviewed this information, we will be able to progress to the final stages of the investigation.
We're aware that principal firms have provided guidance to customers that were mis-sold their B&G mini-bond between 31 October 2016 - 1 March 2018. To clarify, if a customer ‘rolled over’ their investment after 1 March 2018, FSCS will consider their claim against B&G Finance Ltd.
Please note that a customer doesn’t need to have received advice to make a claim to FSCS against B&G Finance Ltd.
FSCS
Contact us by phone on the number below, or via the contact form on the Contact us page.
FSCS holds data for bondholders that includes the value of funds invested into each individual bond, as well as any interest payments made. Our compensation calculation takes the amount invested into an individual bond and deducts the amount of any coupons or interest payments made.
FSCS is investigating possible mis-selling of the mini-bonds by other related firms prior to 1 March 2018.
The position is quite complicated as there were several different related firms that carried out different activities during different periods of time, some of which were regulated and some not.
We don’t think any regulated activity could have taken place prior to 31 October 2016, so FSCS is unlikely to be able to protect mini-bonds issued prior to this date.
If customers consider that they were mis-sold their B&G mini-bonds between 31 October 2016 – 1 March 2018
1) by a firm (other than B&G Finance Ltd) that acted as an appointed representative, and
2) there is a solvent principal firm that has a liability,
customers should complain to that principal firm, including through the Financial Ombudsman Service.
One of the requirements for FSCS to be able to pay compensation is that the firm carried out a regulated activity.
LCF issued its own bonds, and we don't consider that this was a regulated activity. So FSCS will not be able to protect all LCF customers.
B&G Finance Ltd operated under a different structure. It did not issue its own bonds but arranged for customers to buy bonds issued by a different firm.
FSCS is satisfied that it carried out the regulated activity of arranging. Because the other requirements under our rules are also met, we think we will be able to protect many customers of B&G Finance Ltd.