£1M FIASCO OF DISASTROUS PFA FINANCIAL ADVICE
THE extent of the damage caused by the PFA’s doomed financial arm has been revealed by a ‘last resort’ compensation scheme, who have told
Sportsmail they paid out more than £850,000 to investors. As this newspaper disclosed last week, a number of former players pumped their savings into PFA Financial Management Ltd — on the advice of employees of the union — but it went into liquidation in 2009 more than £1m in the red. At least £150,000 of the money that was lost by the firm was never paid back, we can now reveal. And six investors could only receive the maximum pay-out of £50,000, rather than the actual sum they were owed, due to limits on what the Financial Services Compensation Scheme can pay each claimant. In response to a series of questions about the collapse of PFA Financial Management Ltd, which was founded in 1989 by Brendon Batson and others, FSCS confirmed that they ‘paid £857,000 in compensation’ and that ‘26 people successfully claimed compensation’. Given that the firm owed £1,012,601 when it went into liquidation, it means that more than £155,000 was lost. FSCS added that: ‘For six out of the 26 claims, FSCS paid the maximum compensation of £50,000.’ One of these six was a former player who told
Sportsmail that he lost closer to £80,000 and was on the brink of bankruptcy as a result of the company going under, and it took him several years to recoup the £50,000. When asked whether they had tried to pursue recoveries from PFA Financial Management Ltd, FSCS responded by saying: ‘There was no prospect of recoveries — the final liquidation report stated no dividend available to unsecured creditors.’ The FSCS compensation fund is drawn from a levy it charges to the financial services industry, and the scheme is described as a ‘last resort for customers of authorised financial services firms’. As Sportsmail revealed last week, investors in the PFA’s financial arm were advised on a commercial property investment by former Derby County defender Ian Dalziel, who described himself to them as a ‘financial executive’. Yet, it has since emerged that Dalziel was actually only a ‘trainee investment adviser’ at the time, according to the Financial Services Register. The news came as such a shock to some players that they have said they are considering legal action against the PFA for poor advice.