The Financial Services Compensation Scheme (FSCS) has said it is awaiting the results of a Serious Fraud Office (SFO) investigation into failed property investment Arck before deciding whether it will compensate over advice to invest in it.
The FSCS said it has received "a number of claims" against independent financial advisers that are no longer trading in relation to advice they gave to invest in Arck.
Arck is a UK based investment vehicle that was set up to develop and sell overseas based properties. It was placed into liquidation in 2012.
The FSCS said it is aware that investors in Arck have "suffered significant losses", though adds that at this time the cause of these losses is unclear.
The SFO has confirmed that it is investigating allegations of fraud involving investments made in Arck.
The FSCS said in a statement: "We are awaiting the completion of the SFO's investigations before reaching a view on the liability of the financial advisers against which we have received claims.
"At this stage we are unable to confirm whether any losses incurred by investors were caused by the advice they received from the financial advisors to invest in Arck.
"Once we are able to confirm our position, we will provide a further update on our website, and contact the claimants who have previously submitted claims to FSCS in relation to the fund.
"We would like to assure investors that we will provide more certainty about our position to claimants as soon as we are able."
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