mowatt financial Planning

mowatt financial planning
Mowatt Financial Planning: June 2009

Monday, 15 June 2009

Key Data - did I jinx them?

It's a bit disappointing that Key Data have gone into administration shortly after I recommended their product (see previous post). Unfortunately it doesn't help the reputation of the structured product market.

It does, however, appear that it is only some of the products where there is a problem. In any event, investments have been segregated in nominee accounts and investors should receive no financial loss, though there could be delays on income payments and maturities until another administration company takes over.

It appears that the FSA pushed them into adminstration on the back of some tax that was due to the HMRC as a result of issues with the treatment of assets used under an ISA wrapper. This feels a very heavy handed approach given that the tax bill is often a negotiation with HMRC.

I can't see the consumer benefit of the FSA's action. Their approach seems inconsistent at best.

However, there were no issues with the product that I suggested and there are other similar products on the market. For the moment, I would stick to other providers until the Key Data position is clearer.

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