FCA publishes letter of concerns with Morses Club’s current proposed Scheme of Arrangement

Morses Club attended court today to seek the views of the court before proceeding to the next stage in the Scheme of Arrangement process. The Financial Conduct Authority (FCA) submitted a letter to the firm and the court ahead of the hearing, as it has a number of concerns with the firm’s proposals.

The FCA has concerns about the uncertainty of the funding that would be needed for the scheme, the methodology for identifying customers owed compensation and that consumers could be worse off as result of the scheme.

The FCA also has concerns about whether the pros, cons and risks of the Scheme would be brought to customers’ attention effectively, when asked to vote on the Scheme. Today, the court adjourned the Convening Hearing so that the firm could consider how to respond to the FCA’s comments and concerns.

Morses Club has said they will look into these concerns and consider whether improvements can be made ahead of the sanction hearing. We will assess the updated proposal in due course.

In the interests of transparency and giving all Scheme creditors and wider stakeholders an opportunity to better understand the FCA’s position, the FCA has today published its letter of concerns.