Lifemark's Luxembourg administrator has rejected FSA claims the regulator is "working closely" with the cash-strapped fund to avoid its liquidation.
KPMG's Eric Collard, who is the Luxembourg-based provisional administrator of Lifemark, flatly denies recent FSA assurances it is in regular talks with him to resolve the fund's liquidity problems.
He says it is his job to secure the financial restructuring of Lifemark and FSA is playing no role.
"In contact with IFAs? Yes. The FSA not at all. I am not in contact with the FSA. I confirm I am not and authorise anybody to make the correction by quoting me."
His statement comes as bondholders frustrated by the UK regulator's failure to act to save Lifemark, which backed Keydata plans held by 23,000 customers, have set up their own international "action group" including IFAs.
A financial proposal put forward by the group is understood to be in the "very early stages" of approval by the Luxembourg regulator. It is separate to any plan being worked on by Norwich & Peterborough (N&P), which has around 3,100 customers involved in the debacle.
Collard's rejection follows a statement from the FSA in which an unnamed spokesperson tried to reassure Lifemark investors the FSA's own investigation into the matter is continuing apace.
FSA spokesperson Cerris Tavinor said: "We continue to work closely with Keydata's administrators, the Luxembourg financial services regulator (which regulates SLS and Lifemark) and Lifemark's provisional administrator in Luxembourg.
"The protection of consumers is at the forefront of our minds when considering any proposals."
The FSA continues to face heavy criticism for its handling of the Keydata crisis, including not intervening earlier when it realised there were problems at the firm.
Former Lifemark director and Keydata founder Stewart Ford also claimed last week that the FSA blocked a £30m Keydata rescue package. Ford says he offered to inject new assets into Keydata to rescue some of the 5,500 investors to whom it had sold bonds from Luxembourg firm SLS.
This week could be a key turning point for the 23,000 customers who invested £350m in Keydata plans backed by Lifemark bonds as the FSCS is expected to announce its compensation decision.
The FSA says it stands by its earlier statement and declined to make further comment.
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