Catalyst Investment Group Limited in default

4th October 2013

Eligible customers of Catalyst Investment Group Limited (Catalyst) may be entitled to compensation after the Financial Conduct Authority (FCA) confirmed today that it has declared the firm in default.

Catalyst had a key role in promoting funds backed by ARM Asset Backed Securities SA, which have been suspended since 2011. The default declaration means FSCS is now able to consider claims against the firm in relation to the ARM funds.

This follows an investigation by FSCS and the FCA to establish the extent to which Catalyst may be liable for investors’ claims. Following an analysis of the financial promotions which Catalyst was responsible for, we have reached the view that Catalyst may be liable for losses in many cases.

FSCS has also considered further the potential liability of financial advisers, including Rockingham Independent Limited, in relation to advice they gave their customers to invest into ARM funds. We have concluded that, whilst there may be limited circumstances in which financial advisers will be liable for investor losses, in light of the default of Catalyst, FSCS will handle investors’ claims against Catalyst in the first instance.

FSCS is currently finalising its claims process and gathering the data it will need to process claims against Catalyst. We expect this work to be completed in November, after which we will confirm the process for making a claim with FSCS against Catalyst. We will contact directly the investors who have already registered claims with FSCS against financial advisers (including Rockingham), and investors who have referred complaints against Catalyst to the Financial Ombudsman Service to confirm the process at this time.

ARM investors do not need to take any action in the meantime in relation to a potential claim with FSCS.