Investors in Arch Cru products received letters in early November 2011 setting out the compensation they will receive following the failure of the investment firm in 2009. Most are expected to receive around 70{0a6a65c996ed4169444354e707b897cdb00dbefc1d0429e8febb9bf11027ba53} of their losses, leading to suggestions that many will pursue the balance with further claims against their financial advisers.
The compensation package has been agreed with the Arch Cru funds range’s authorised corporate director Capita as well as BNY Mellon and HSBC, but many investors have been highly critical of the plans, regarding the compensation offer as inadequate. In a parliamentary debate on the Arch Cru affair, Labour Shadow Treasury minister Chris Leslie warned the debacle had undermined people’s trust in the financial services industry.
A report on the latest development in the Arch Cru case appears in Money Marketing here. The announcement from Capita on the creation of the compensation fund appears here.
“The Arch Cru affair shows just how vulnerable IFAs can be to a failure by a product provider. With professional indemnity insurance rates high and rising for IFAs, high quality risk management procedures and a good claims record are essential to secure the lowest possible premiums.”
