FCA has taken the relatively unusual step of publishing a letter of concerns it lodged in relation to Amigo Loans’ application to implement a Scheme of Arrangement. FCA does not support the scheme for a number of reasons, not least that it is concerned that customers with valid redress claims would receive significantly less than their claim value and that the methodology for claims assessment would not produce as accurate or fair an outcome as the normal FCA/FOS calculations. That said, FCA does not currently anticipate taking any additional regulatory action that might prevent the Scheme having substantial effect.
FCA also drew attention to the fact that secured creditors, shareholders and other unsecured creditors are expected to be kept whole and that secured creditors will be repaid in full. It is also concerned that the calculation methodology proposed is not transparent. It noted a number of other concerns also, including the impact on the (likely large) number of consumers that do not engage with the process.