Source · Select Committees · Treasury Committee
Recommendation 27
27
Paragraph: 157
The collapse of LCF brought about a huge degree of uncertainty for bondholders, some of...
Conclusion
The collapse of LCF brought about a huge degree of uncertainty for bondholders, some of whom were faced with an anxious wait for the publication of Dame Elizabeth’s report and further details of the Government’s compensation scheme. We welcome the approach that the Treasury has taken to compensate LCF bondholders, a scheme that we believe will provide substantial assistance to a very large proportion of those who have lost out and who have not qualified under other forms of compensation available. The Government has taken a reasonable approach in striking the balance between consumer responsibility for their investment decisions and recognising the FCA’s failure to discharge its functions in respect of LCF such that it fulfilled its statutory objectives. We support the principle of the Bill to provide compensation to LCF bondholders.
Paragraph Reference:
157
Government Response
Not Addressed
HM Government
Not Addressed
The Treasury is progressing work on the LCF compensation scheme rules, in close collaboration with the Financial Services Compensation Scheme (FSCS) who will administer the scheme. The FSCS is committed to ensuring that payments are made to all eligible LCF bondholders within 6 months of securing Royal Assent of the Bill currently before Parliament. The Treasury is ensuring the Government scheme is coordinated with the administration process and the FCA complaints scheme, to the best extent possible.