Large unincorporated associations may now be eligible for protection

3rd October 2013

Large unincorporated associations such as charities or societies, that were not considered eligible for deposit compensation following the collapse of Kaupthing Singer and Friedlander Bank (KSF) and Landsbanki Islands hf in 2008, may now be entitled to compensation from the Financial Conduct Authority (FCA) it confirmed today.

The FCA has also announced it will be consulting on proposals to extend eligibility for FSCS compensation to all unincorporated associations and to certain large partnerships if an investment firm fails.

Alongside the FCA consultation, the Prudential Regulation Authority (PRA) intends to consult on proposals to clarify the compensation rules for deposits. This will mean in future all unincorporated associations, regardless of size, will be within the scope of FSCS protection for deposits.

The FCA’s announcement is available on its website.

Anyone who believes they were an unincorporated association or partnership that did not receive compensation for deposits or investments because of its size should contact FSCS’s Initial Contact Team on 0800 678 1100 or 7741 4100.

More information

  • The FCA’s consultation paper ‘Financial Services Compensation Scheme – unincorporated associations and partnerships’ can be found here.
  • The PRA’s consultation ‘Occasional Consultation Paper CP8/13’ can be found here. The relevant section is Chapter 5: FSCS Protection for large unincorporated associations’ deposits.
     

Jargon Buster

  • Deposits

    money placed in a bank or similar institution to earn interest or for safe-keeping.
  • Eligible

    qualifying for compensation under Scheme rules.
  • FCA

    The Financial Conduct Authority is the UK's regulator for the financial services industry. 

  • Investment

    a financial product in which money can be invested to earn interest or profit (although the value of investments can go down as well as up).