FSCS paying first LCF claims
The Financial Services Compensation Scheme (FSCS) has paid just under £2.7m to 135 LCF customers in relation to 151 bonds. These were invested following transfers out of stocks and shares ISAs, and FSCS has made these payments automatically without the need for these customers to submit an application.
FSCS has compensated these customers because arranging a transfer out of a stocks and shares ISA is a regulated activity.
Any customer who expected to receive compensation in relation to bonds which were invested following transfers out of stocks and shares ISAs, who has not received a letter from FSCS by 24 February 2020, is invited to provide evidence to FSCS. More information about this is available on the FSCS website in the LCF Q&A section.
FSCS has concluded there will be some customers who were given misleading advice by LCF and so have valid claims for compensation. In relation to advice claims, we are continuing to review the evidence we hold. At this stage, customers do not need to submit a claim to FSCS. We will provide a further update to customers by the end of March 2020.
Caroline Rainbird, FSCS’s Chief Executive said: “We appreciate that this is a difficult time for the majority of LCF’s customers who are still waiting to find out if they are entitled to compensation. FSCS is making progress in finalising its arrangements for reviewing advice claims and is committed to ensuring the process is as quick and as easy as possible for customers.”
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Notes for editors
Read more about the remit of FSCS on our Notes for editors page.