Wednesday, March 11, 2009

FSA investigates Lehman-linked investor losses

The Financial Services Authority is investigating possible mis-selling of "capital secure" growth bonds linked to Lehman Brothers which caused major investor losses.

The FSA is examining promotional material issued for the structured products, which left some investors unaware that they were invested with Lehmans, and others that they had no comeback against the com-panies promoting the bonds or the Financial Services Compensation Scheme.

Companies including NDF devised bonds linked to Lehman. These companies told investors on Lehman's collapse last September that they would be treated as creditors of the collapsed bank John McFall, chairman of the Treasury select committee, wrote to the FSA chief executive Hector Sants yesterday saying he believed it could be "a serious case of mis- selling in the financial services industry".


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