Endowment seller unable to pay award

Washbrook

After 3 years going through the Financial Ombudsman Service the Ombudsman found in our favour following a complaint of miss-selling against an IFA. The IFA was given 4 weeks to offer their compensation based on the agreed formula. Now, with 2 weeks to go we have been advised by the FOS that the firm have stated that they are unable to pay our award. The FOS advises us that if this is the case we may have to go through the Financial Services Compensation Scheme. Is this yet another delaying tactic employed by the firm.

We are also concerned that the IFA appears on the FSA register as "not authorised" as from August 2006, will this have a bearing on our award.

Any help greatly appreciated.

dunstonh

The firm is no longer authorised and is unable to pay its liabilities. You now need to go to the FSCS.

The winding up of the firm could be linked to failure or it could be retirement or closure.

The FSCS will review the finances of the company and see if there any assets it can call upon to meet the liability. If not, it will review the situation and pay it from the FSCS. It may not be as much as the award though and a recalculation would be likely.

FSCS cases can take upto 2 years so dont hold your breath.

Washbrook

Many thanks for that. I understand the The FSO has already passed the details on to the FSCS. They told me it could take 6 - 8 weeks but I have found from experience that the wheels always seem to turn slower than expected.

defender_of_the_weak

If you are claiming against a recently closed IFA it will more than likely take 2 years. The FSCS have to undertake a full investigation to prove that the company held no other assets or source of income sufficient to meet your claim.