Lawyers representing Norwich & Peterborough (N&P) customers sold Keydata products have written to CEO Matthew Bullock accusing him of seeking "special treatment" over compensation claims which could hit thousands of IFAs.
Regulatory Legal is challenging Matthew Bullock to explain why he believes his building society should be allowed to "suspend" complaints about Keydata until after a Financial Services Compensation Scheme (FSCS) decision on the case.
N&P has said it is seeking a waiver from the FSA to suspend all complaints in relation to the product.
Such a waiver has not been granted to any other IFA firm in relation to Keydata and Regulatory Legal believes it would be wrong for the FSA to allow special treatment to N&P.
Lawyer Gareth Fatchett says: "If this were a small IFA firm, would the FSA even listen to this request ? We think not."
Thousands of IFAs exposed to crippling Lifemark and Keydata compensation claims face bankruptcy because a common insolvency exclusion in professional indemnity (PI) insurance will leave them without cover.
Even IFAs with valid PI can expect costs of £5,000 to £10,000 or more in excess per claim, as most PI policies treat complaints individually even if many relate to the same company.
N&P has received over 400 complaints in relation to Keydata products sold following advice from their IFAs.
Bullock has said compensation claims could run to £50m - 50 times the profit N&P made last year.
An FSCS decision was expected on Monday, and N&P customers received a letter saying Bullock would meet them to discuss Keydata later this week.
However, no FSCS decision has yet been announced and the building society has confirmed it has cancelled the meeting and postponed it until after the FSCS ruling.
The eight-month FSCS probe has centred on whether Keydata is legally liable for capital losses that may arise for savers in funds backed by Lifemark.
But Fatchett says: "The advice was provided by N&P, not Keydata. The TCF approach of the society is appalling. They are simply ignoring their members' problems and issuing warm words to tell them they care. Their actions are to fob people off."
The FSCS investigation has attracted fierce criticism from IFAs and investors over its length, but the compensation scheme says its job has been complicated by ongoing attempts to stave off Lifemark's insolvency through financial restructuring.
N&P is currently one of several parties in "early stage" talks about a potential cash injection into Lifemark to secure the fund's future.
Lifemark, which ran bonds backing Keydata plans owned by 23,000 customers who invested £350m, has just months before its short term liquidity crisis forces it into insolvency.
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