Intermediaries could face another multi-million pound interim levy after the Financial Services Compensation Scheme (FSCS) warned it may need an extra £40m to meet compensation costs this financial year.
Ongoing and higher-than-expected compensation costs linked to stockbroker Wills & Co and life settlement vehicle Keydata are to blame, the FSCS' stated in its half year review out today. But the scheme warned the total investment intermediation costs could breach £100m if compensation claims relating to Arch Cru and MF Global materialise. This would trigger cross-subsidy to the investment fund management sub-class. The FSCS review document reported: "We may now incur higher compensation costs than we estimated in the investment intermediation sector as a result of the failures of K...
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