Asked by: Mike Amesbury (Labour - Weaver Vale)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what discussions he has had with representatives of the (a) Financial Conduct Authority and (b) Financial Services Compensation Scheme to ensure that investors in mini-bonds such have adequate information on the risks of such schemes before investing following the collapse of London Capital & Finance.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
On 1 April, the Government announced it will direct the Financial Conduct Authority (FCA) to launch an investigation into the events and circumstances surrounding the failure and placing into administration of London Capital and Finance plc (LCF). This followed a request from the FCA Chair, Charles Randell, to launch such an investigation.
On 23 May 2019, the Government laid a direction before Parliament setting out the terms of the investigation. Alongside this, the Government announced it will separately review the wider policy questions raised by this case.
Although operationally independent, the Financial Services Compensation Scheme (FSCS) and the FCA are both accountable to HM Treasury and to Parliament. My officials and I engage with the FCA and FSCS on an ongoing basis, and HM Treasury continues to work with the relevant bodies on the failure of LCF as a matter of priority. The FSCS is also continuing work to increase awareness and understanding of FSCS protection.
Asked by: Lord Myners (Crossbench - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government whether the proposed independent review of the Financial Conduct Authority's (FCA) supervision of London Capital and Finance will be supported by (1) an independent secretariat, or (2) secondees from the (a) FCA, (b) Prudential Regulation Authority, (c) HM Treasury, or (d) Bank of England.
Answered by Lord Young of Cookham
On 23rd May, the Economic Secretary to the Treasury laid before Parliament a Direction requiring the Financial Conduct Authority (FCA) to carry out an independent investigation into the events and circumstances surrounding the failure of London Capital and Finance. The operational resourcing of this investigation will be a matter for the FCA and Dame Elizabeth Gloster, the independent investigator it appointed.
Asked by: Peter Kyle (Labour - Hove)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what the terms of reference are for the investigation by the Financial Conduct Authority into the failure of London Capital & Finance.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
Further details of this investigation will be published shortly.
Asked by: Peter Kyle (Labour - Hove)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what level of (a) financial resources and (b) personnel has been allocated to the investigation by the Financial Conduct Authority into the issues raised by the failure of London Capital & Finance.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
Further details of this investigation will be published shortly.
Asked by: Peter Kyle (Labour - Hove)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what the timescale is for the investigation by the Financial Conduct Authority into the failure of London Capital & Finance.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
Further details of this investigation will be published shortly.
Asked by: Lord Myners (Crossbench - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government whether Treasury ministers or officials have been in discussions with the Financial Conduct Authority (FCA) about the establishment by the latter of an independent review into the FCA’s supervision of London Capital & Finance; and why the terms of reference of the review and the identity of the independent reviewer have not yet been published.
Answered by Lord Young of Cookham
This Government takes the failure of London Capital & Finance (LCF) and its impact on consumers very seriously. The independent investigation will seek to better understand the circumstances around the collapse of LCF and make sure we are properly protecting those who invest their money in the future.
It is essential that the terms of the investigation are set in a way that ensures these objectives are met and take into account any issues arising from current regulatory and enforcement investigations. HM Treasury officials are working to develop these with the relevant bodies as a matter of priority. Further details on this investigation, including the appointment of the independent investigator, will be published shortly.
Asked by: Steve Reed (Labour (Co-op) - Croydon North)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what discussions he has had with the Financial Conduct Authority on the collapse of London Capital & Finance Ltd.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The Government takes very seriously the failure of London Capital and Finance (LCF). On 1 April, I wrote to the Chair at the Financial Conduct Authority, Charles Randell, to say I will use powers under the Financial Services Act 2012 to direct the FCA to launch an investigation into the events at LCF and the circumstances surrounding them. This followed a request to me from Charles Randell to launch such an investigation.
Asked by: Lord Myners (Crossbench - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government whether they intend to launch an independent review into the Financial Conduct Authority's regulatory oversight of London Capital and Finance Plc.
Answered by Lord Bates
On 1 April, the Economic Secretary announced that he will use powers under the Financial Services Act 2012 to direct the Financial Conduct Authority (FCA) to launch an investigation into the events at London Capital & Finance and the circumstances surrounding them. This followed a request from the FCA Chair, Charles Randell, to the Economic Secretary to launch such an investigation.
The investigation will be led by an independent person appointed by the FCA, with the approval of HM Treasury.
Asked by: Rosie Duffield (Labour - Canterbury)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will publish the timetable for the review of London Capital and Finance following its collapse.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
On 1 April, I announced that I will use powers under the Financial Services Act 2012 to direct the Financial Conduct Authority (FCA) to launch an investigation into the events at London Capital & Finance and the circumstances surrounding them. This followed a request to me from the FCA Chair, Charles Randell, to launch such an investigation.
The investigation will be led by an independent person appointed by the FCA, with the approval of HM Treasury. Further details of the independent investigation will be communicated in due course.
Asked by: Lord Vaizey of Didcot (Conservative - Life peer)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what discussions he has had with the Financial Conduct Authority on the administration of London Capital and Finance PLC.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The Treasury is monitoring developments relating to the failure of London Capital & Finance (LCF) very closely and is in regular contact with the Financial Conduct Authority.
However, the Treasury has no formal role in the administration process of a firm such as LCF and it would be inappropriate for us to comment on the administration process, which is a matter for the joint administrators – in this case, Finbarr O’Connell, Adam Stephens, Colin Hardman and Henry Shinners of Smith & Williamson LLP.
Further information regarding the administration itself can be found on the joint administrators’ website at the following link:
https://smithandwilliamson.com/business/services/restructuring-and-recovery-services/london-capital