FSCS joins partners to form phoenixing group
The Financial Services Compensation Scheme (FSCS) and several regulatory bodies have formed a group to discuss approaches and collaboration for tackling phoenixing.
The Financial Services Regulatory Partners Phoenixing Group was convened on 25th April by the Financial Conduct Authority (FCA) and also includes the Financial Ombudsman Service (FOS), the Insolvency Service and Scotland’s Accountant in Bankruptcy.
Phoenixing means firms and individuals deliberately seeking to avoid their liabilities to consumers or poor conduct history by closing down firms – or resigning senior positions – only to re-emerge in a different legal entity.
Whilst the partners have shared information and discussed phoenixing in the past, this is the first time that they have come together as a group and in a formal way to discuss and agree to work together to tackle the issue.
Sharing data on issues such as FSCS claims is proving highly effective in preventing and detecting instances of phoenixing.
Alex Kuczynski, Chief Corporate Affairs Officer at FSCS, said:
'This is a great opportunity for the FSCS to share its knowledge and insights. This working group will support better outcomes for both consumers and levy payers who have to step in to fund FSCS’s compensation, and fully aligns with the 'Prevent' pillar of our strategy for the 2020s.'
Details of the ‘Prevent’ pillar can be found in p.11 of the FSCS 2020s Strategy document.
More details and comments from the Group can be found in the FCA’s press release on its website.
Anthony Ozimic / 020 7375 8638
Adam Smith / 020 7375 8636
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