The Mail on Sunday
‘We all invested but not all of us are being paid’
RETIRED pub owner David Woodhead cannot quite believe what has happened.
He is an ordinary, cautious saver who was careful to entrust money only to supposedly sound investment companies authorised and regulated by the Financial Services Authority and covered by the Financial Services Compensation Scheme, just in case anything went wrong.
David, 66, was also impressed by companies that were closely associated with other, blue-chip firms, such as auditing giant KPMG.
And so in November 2005, when David and his wife Beth, from Holmfirth, West Yorkshire, invested £30,000 in Keydata, it met all these criteria.
Keydata was authorised by the FSA and as such belonged to the compensation scheme. The brochure for the plan referred extensively to other big companies including KPMG, which ‘constructed the financial models...and checks the credit ratings of the companies issuing the contracts...and monitors the credit rating of the portfolio...’
These were lies. KPMG did no such thing. In fact, just one month before David invested, KPMG had demanded that Keydata drop the ‘inaccurate and misleading description’.
And although Keydata was supervised by the FSA, the watchdog failed to spot that Keydata was passing savers’ money to a Luxembourg business, where it appears to have been lost or stolen.
The worst news for the Woodheads, however, arrived a few days ago when they learnt they would not be compensated by the FSCS. It said that for legal reasons his claim for compensation had failed, but did not explain why.
David says: ‘It appears our claims stand or fall according to how ignorant or eloquent we are when we fill in a form. We all invested, but not all of us are being paid. Why are some of us getting compensation and some not?’