One of the lead cases brought by Arch cru investors against Capita has been put on hold by FOS pending a decision on whether the ombudsman is the appropriate body to deal with the complaint.
Investors argue Capita allowed Arch cru to make high-risk investments despite the funds being marketed as low risk, and failed in its duty as authorised corporate director to prevent the fund being mispriced.
A FOS adjudicator stated ongoing investor detriment reviews by Capita and the FSA into the debacle should deal with the role of Capita and whether any mis-management caused consumer detriment, IFAonline understands.
The case is one of several that law firm Regulatory Legal, which acts on behalf of 2,500 Arch cru investors, has agreed with Capita's lawyers to use as representative or a 'lead' complaint. Its success or failure would be a bell-weather for the rest of the claims.
Lawyers for the investors said the delay is significant as the FSA has the power to order redress to all Arch cru investors as part of a settlement arrangement if its review finds failings at Capita were to blame for their losses.
However, if FOS states it will not entertain complaints until the review by Capita is concluded investors could face further delays for redress.
Investors' lawyers are pushing for the FOS, Capita and the FSA to provide timescales for the conclusion of the reviews. The Capita and FSA reports had been expected this month.
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