Investors could take legal action against Norwich and Peterborough building society
Ben KendallThe Norwich and Peterborough building society could face a multi-million pound group action from investors whose life-savings are caught up in the collapse of an investment company.Ben Kendall
The Norwich and Peterborough building society could face a multi-million pound group action from investors whose life-savings are caught up in the collapse of an investment company.
Three thousand five hundred people invested in Keydata Investment Services savings plans on the advice of financial advisors at branches of the N&P across Norfolk. Keydata was forced into administration last year and is now being investigated by the Serious Fraud Office.
Yesterday the Financial Services Compensation Scheme said it had begun paying out in thousands of cases. However, many more remain unresolved and customers fear they may lose life savings ranging from �5,000 to more than �100,000 pounds.
Among them is David McEwan from Norwich invested �48,000 in Keydata on the advice of an adviser in N&P's Aylsham Road branch.
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Geoff and Jenny Palmer, from North Walsham, were told this was a sound investment as it was not exposed to the stock market.
Mrs Palmer said: 'We are devastated by these events; this is a large portion of our future retirement fund. We have worked hard for this money and feel we have been robbed of the future it was supposed to give us.'
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The N&P refused to confirm the total value of funds invested through its advisers but it is thought to run in tens of millions.
A spokesman confirmed the building society had received 125 complaints from people who believe products, which were presented as low or medium risk, were mis-sold. Others have contacted the Financial Ombudsman.
The N&P says it is working hard to help customers. Bosses believe the company acted properly and the collapse of Keydata had been unforeseeable. The issue does not affect the stability of the building society and the majority of customers who do not have funds invested in Keydata are not at any risk.
Administrator PricewaterhouseCoopers is expected to issue a proposal to investors within weeks.
Gareth Fatchett, partner at Regulatory Legal which specialises in the financial services sector, said his firm is constructing a challenge against N&P over alleged mis-selling. The firm has organised two meetings in Norfolk to offer advice to those hit by the crisis.
He added: 'We have been contacted by literally hundreds of individuals who received advice to invest into the Keydata products by N&P. We are reviewing the advice process of N&P and the way they have dealt with predominantly retired people.'
t Keydata investors who would like legal advice from Regulatory Legal are invited to attend meetings at the Dunston Hall hotel, near Norwich, at 11am and 3pm on May 28 and June 4.