The UK Financial Services Compensation Scheme (FSCS) today provided an update on the London Capital & Finance (LCF) matter. FSCS has now been paying compensation to LCF bondholders who are eligible for the government’s scheme for three weeks.

So far FSCS has contacted more than 7,750 people, issuing cheques for over 10,000 bonds totalling £91.1 million. This means that just over 84% of eligible bondholders have received compensation so far.

FSCS is continuing to send out letters and cheques, and it expect at least another 200 bondholders to be contacted by the end of the year. The remaining offers involve more complex calculations and will come through in early 2022, with everyone receiving their offer by 20 April.

As a reminder, if you are eligible for the government scheme and invested in ISA bonds with LCF, you will receive the standard compensation offer letter plus an additional letter from FSCS with the details you will need to show your ISA manager. These letters will arrive separately, and batches are being sent out frequently.

If you are waiting for an additional ISA letter, you can still cash your cheque for compensation in the meantime. You can use any funds up to the value of your compensation cheque to make a single contribution to an existing ISA, you do not need to use the cheque directly.

London Capital & Finance (LCF) was a Financial Conduct Authority (FCA) authorised firm which issued unregulated non-transferable debt securities, commonly known as ‘mini-bonds’, to investors and then speculatively invested the funds received in a number of underlying businesses. LCF went into administration in January 2019 and at the point of failure 11,625 bondholders had invested around £237 million.