A legal row over the £194 million compensation plan for investors stung by the collapse of several split capital investment trusts in 2002 has been resolved, the UK's Financial Services Authority and the Jersey Financial Services Commission revealed on Friday.
It had been feared that the failure of two of the 22 companies involved in the settlement to sign an agreement which would have prevented the firms from suing one another to reclaim losses, would prevent it from going ahead.
However, it subsequently emerged that consensus had been reached on the matter, allowing the plans to compensate the affected investors to move forward.
According to a statement released by two authorities last week:
"A company, Fund Distribution Limited ("FDL"), has been set up to make distributions from the fund to eligible investors who invested in certain Zeros and in a number of specified unit trusts and other financial products that invested heavily in Zeros. Distributions will be focussed upon private investors and their small investment vehicles that held the specified financial products at any time between July 2000 and June 2002."
"An eligible investor will only be entitled to receive a distribution if the amount assessed by FDL in relation to them is at least £250 across all of their specified financial products..." FDL will publish further details in the first quarter of 2005, including the application deadline. Investors will then have to apply for a distribution from the fund by that deadline.
The statement concluded by announcing that:
"The current intention is that applicants who accept the offer will receive an initial distribution from FDL in the fourth quarter of 2005. If there are still monies available, subsequent distributions may be made with an intention to complete the distribution by the end of 2005."
