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Screenshot of a breaking news alert e-mail from Q2 2017
While former Alpari UK’s clients are still waiting for the second tranche of compensation payments from the Financial Services Compensation Scheme (FSCS), the organization today posted its Annual Report for the 2014/2015 year. That is the 12-month period until March 31, 2015.
The FSCS provides detailed data on the work done for the period in question, with the report including information about the job done regarding Alpari UK, the company that appointed special administrators following heavy losses suffered due to “Black Thursday” events.
The FSCS refers to tackling issues with former Alpari UK clients as one of the highlights of 2014/2015.
Alpari (UK) Limited and LQD Markets (UK) Limited
Following the market reaction after the Swiss National Bank’s decision on 15 January 2015 to remove the informal peg between the Swiss franc and the euro, Alpari (UK) Limited and LQD Markets (UK) Limited were placed into special administration and declared in default. FSCS has been working with the relevant special administrators to determine FSCS’s involvement in paying compensation to clients of the firms and ensuring that FSCS’s compensation process aligns with the obligations of the special administrators to return client monies.
In the case of Alpari (UK) Limited, FSCS has confirmed that all accounts are protected by FSCS which meant that FSCS and the special administrators were able to announce a process in April 2015 whereby clients of Alpari could register FSCS claims through the firm’s website, helping to facilitate the payment of compensation to eligible claimants.
The organization estimates compensation costs at approximately £27.6 million ($43.1 million).
The report states:
Compensation costs include £27,595,000 estimated for Alpari (UK) Limited. This takes into account our best estimate of the most likely number of claims FSCS expects to receive and of the amount of these claims using the best information available to the directors at this time. There are significant judgements which had to be made in arriving at this estimate and the final outcome could be significantly different.
- Overall, total compensations the FSCS paid out in 2014/2015 totaled £327 million (except for major banking failures), up from £243 million in 2013/14.
- The average compensation payment was £8,855 compared with £5,136 in 2013/14.
To view the full report by FSCS, click here.