Professional Adviser

N&P stalls Keydata customers for five more weeks

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Norwich & Peterborough Building Society (N&PBS) has written to Keydata-exposed customers to say their complaints will remain unresolved for at least five more weeks.

Under FSA rules the building society must inform customers if it is unable to resolve a dispute within eight weeks.

This initial period has lapsed, and N&P has contacted 184 investors to tell them it has still not resolved their complaints about N&P IFAs' advice to invest in failed life-settlement vehicle Keydata.

Signed by N&P's legal and compliance manager Jane Pearson, the letter gives 19 November as the next deadline date to let investors know if their complaint has been resolved.

One reason for the delay is N&P is waiting to see how much compensation the Financial Service Compensation Scheme (FSCS) will set aside to cover Keydata investors, says a spokesperson for the building sociey.

In September the FSCS confirmed it can compensate "elligible" investors with Keydata products backed by Luxembourg-based fund Lifemark, like the ones sold by N&P, but it will not publish the amount they will receive until the end of this month.

Complainst are also not being resolved because N&P is still in talks over a possible deal to save the troubled Lifemark fund, which is suffering severe liquidity problems, says the spokesperson.

In the letter to investors says N&P is in talks "with the regulatory community regarding a number of issues which we believe will have a bearing on your complaint".

The building society is rumoured to be part of a deal to front a £13m - £20m loan to stave off Lifemark's liquidation.

Convincing investors to stay in a rescued Lifemark would be a cheaper option for the building society. N&P's CEO Matthew Bullock has admitted the company faces compensation costs of up to £50m over claims it mis-sold Keydata products to some of the 3,100 clients who invested on advice from N&P IFAs.

About 300 N&P customers are taking legal advice on claims for compensation against the building society, which they allege mis-sold and over-exposed them to Keydata.

Keydata was put into administration for insolvency as a result of a tax liability on 8 June 2009. Investors have been unable to access their investment since.

 

 

 

 

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