Professional Indemnity
Represented professional indemnity insurers
of one
of the fund managers involved in the
multi-million pound split
capital trusts losses suffered by investors. |
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From 2001 to 2003 up to 40 split capital investment trusts
were suspended from trading or had appointed receivers and up
to
50,000 investors had lost money. Estimates put those losses
at
more than £620m.
Following concern amongst the regulatory authorities and
parliament
and against the background of potential class actions
by investors,
the FSA launched a formal investigation into the
splits market.
This gave rise to a FSA initiative for the splits market to
compensate investors.
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We were retained by the professional indemnity insurers of
one of the fund managers of split funds scrutinised by the FSA.
The potential exposure to insurers was very substantial.
Our clients had underwriting and coverage concerns and the
matter was resolved with insurers making a nominal contribution.
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