LONDON, May 21 (Reuters) - Britain's Financial Services
Compensation Scheme (FSCS) said it had earmarked 44 million
pounds ($54 million) to pay claims from a small number of the
investors who lost money after the collapse of investment
company London Capital & Finance (LCF).
The FSCS said it would levy regulated financial firms 649
million pounds in the 2020/2021 year that started in April, 14
million pounds more than it had indicated in January, in part to
cover the LCF claims.
"The overall increase in the FSCS levy since the January
forecast partly reflects the ongoing progress we are making in
relation to the LCF failure," said FSCS Chief Executive Caroline
Rainbird in a statement.
LCF went into administration in early 2019 with losses of up
to 237 million pounds after the Financial Conduct Authority
(FCA) directed the firm to withdraw promotional material for
so-called "mini bonds".
The compensation body had said it could only help 159 of
11,600 investors holding bonds issued by LCF, leading to
bondholders to seek a judicial review of the FSCS' decision.
"Whilst it is too early to say how many LCF customers will
be eligible for compensation, for the purpose of the levy we
have estimated an amount of 44 million pounds," Rainbird said on
Thursday.
Elizabeth Gloster, a former High Court judge, is heading an
independent inquiry into the FCA's handling of LCF and is due to
complete her report in the summer, which could help bondholders
with their compensation claims.
($1 = 0.8201 pounds)
(Reporting by Huw Jones; Editing by Edmund Blair)