David Cameron, the prime minister, will consider opening an inquiry into the collapse of the Arch cru investment funds during the financial crisis, he told MPs last week.
The prime minister was replying in the Commons to a question from Tom Greatrex, a Labour MP, who observed that the collapse has hit 20,000 British investors.
Cameron said: “I have had contacts from my constituency who have lost money because of this fund, who are concerned about what is happening. I am following the fact that there has been a Westminster Hall debate on this and the minister set out the position in terms of the responsibility of the FSA. But I will look carefully at what he says and see if we can do more.” (article continues below)
Greatrex said: “There are up to 20,000 individuals in the UK who have lost considerable sums of money, often their pension funds, through the collapse of the Arch cru investment funds. “That was a fund advertised and marketed as being cautious that turned out to be anything but. Will the prime minister now heed the calls from all sides of the house for the government … to institute an immediate inquiry?”
Greatrex is the co-chairman of a new all-party parliamentary group on Arch cru that has met FSA representatives to discuss the compensation package offered to investors.
In June the FSA, BNY Mellon Trust & Depositary, Capita Financial Managers and HSBC Bank agreed a £54m compensation fund.
Alongside distributions already made and remaining assets, investors should get back 70% of money that was invested when the range was suspended in March 2009.
Investors who feel they were mis-sold the fund can pursue further claims against their independent financial advisers (IFAs).
Last week the Financial Ombudsman Service provisionally upheld a complaint against an IFA who recommended Arch cru products.
The FSA’s compensation package states that anyone taking compensation must accept it as a full and final settlement against the firms.
The FSA has said IFAs should accept responsibility for investor losses over Arch cru and says it may conduct an industry-wide past-business review and order redress if it finds evidence of mis-selling.