UK FSCS completes investigation into B&G Finance
There is a bit of positive news for customers of B&G Finance, as the UK Financial Services Compensation Scheme (FSCS) today announced the completion of its investigation into the firm.
The Scheme says it has now moved all claims submitted to its claims processing teams for assessment.
FSCS has determined that B&G Finance may have mis-sold Basset and Gold plc mini-bonds to retail customers from March 1, 2018. While this investigation may share similarities with London Capital & Finance, B&G Finance Ltd operated under a different structure. It did not issue its own bonds but arranged for customers to buy bonds issued by a different firm.
LCF issued its own bonds – which FSCS considers is not a regulated activity – whereas B&G Finance Ltd carried out the regulated activity of arranging. Because the other requirements under FSCS rules are also met, the body may be able to protect many customers of B&G Finance Ltd.
B&G Finance Ltd entered administration in April 2020.
From January 2, 2018 B&G Finance Ltd was authorised by the FCA, and from March 1, 2018, it arranged and promoted mini-bonds on behalf of Basset & Gold plc, which issued the mini-bonds. FSCS has determined that due to mis-selling of these mini-bonds, many Basset & Gold bondholders who bought their mini-bonds through B&G Finance Ltd may be able to claim compensation up to the £85,000 limit.
Although Basset & Gold Plc has also entered administration, FSCS is unlikely to be able to pay compensation based purely on Basset & Gold Plc’s failure to repay the bonds, as issuing bonds is not normally a regulated activity.
Customers who bought their bonds through B&G Finance Ltd can submit a claim directly to FSCS.