FSCS sets aside extra millions for Keydata recoveries

The Financial Services Compensation Scheme (FSCS) is proposing to budget more than £7m for expenses related to recoveries in 2013/14, including from advisory businesses who recommended Keydata bonds.

The Financial Services Authority (FSA) consults annually on the FSCS's management expenses levy limit (MELL), which relates to all non-compensation costs the Scheme expects to incur to deliver its functions. For 2013/14, the levy is expected to comprise £7.2m to pursue recoveries including in respect of Keydata. After paying out hundreds of millions in compensation to investors in Keydata, the FSCS is in the process of recovering costs from both the assets of Keydata and the underlying investments, and from advisory firms who were responsible for the sales of the bonds. It is also ...