Investors in the collapsed Arch Cru fund range who sign up to a payment scheme set up by the funds' authorised corporate director, Capita Financial Managers, are in line to receive markedly less than forecast.
Documents sent to investors last month by Capita reveal the estimated total return to investors based on the net asset value (NAV) of the six funds now stands at 61% of the amount invested, down 7.6% on the 66% forecast in September 2011.
Investors in the largest fund, the Investment Portfolio, which contained about 70% of the total amount invested, are now estimated to receive just 58%, down 9.4% on the 64% estimated two years ago.
The Capita payment scheme, which is a £54m compensation package funded by Capita alongside the funds' depositaries, BNY Mellon Trust & Depositary and HSBC Bank, was announced in June 2011 with the backing of the then-regulator, the Financial Services Authority.
Investors have until 31 December this year to apply to sign up to the payment scheme though, by doing so, investors would forfeit the right to participate in any litigation against Capita.
The scheme is separate to another redress package, set up the regulator, whereby advisers who recommended the Arch Cru funds have been required to contact those clients to find out if they want their investment reviewed.
The CF Arch cru fund range was suspended in March 2009 due to a lack of liquidity to deal with redemptions.
The IFA Centre, a trade body representing independent financial advisers, which is campaigning for full compensation for investors in the funds, accused CFML of being misleading in its letter.
This is because Capita's letter only stated the percentage 'movement' in estimated returns. In the case of the Investment Portfolio, this is 6%, as opposed to the real percentage change of 9.4%.
"They [Capita] are using those figures because they are trying to explain to investors that they should be really pleased that they are getting these amounts of money back," said IFA Centre managing director Gillian Cardy.
Stating the movement in returns rather than the actual percentage might lead investors to believe they would be well advised to join the scheme, Cardy added.
She added: "The fact that they are sending that out right before we send them a letter that says we are taking a court action for compensation is a curious piece of timing."
The IFA Centre's claim action against Capita was announced today.
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