Three of the country’s leading building societies have agreed to make payments to account holders caught up in the collapse of a failed investment firm.
Newcastle, Leeds and Nottingham building societies say they are offering “significant voluntary support” to help customers after the collapse of the Philips Trust Corporation in 2022. The three building societies have agreed to restore money invested by their customers with Philips Trust, as well as providing up to £2,400 to customers towards the cost of providing new trustees for them.
The announcement comes after a long battle by people caught up in the Philips Trust administration.
A number of building societies around the country had referred account holders to the Will Writing Company and the Family Trust Corporation for will writing and estate planning services, including the setting up of trusts. But when the Will Writing Company entered administration in 2018, its assets were bought by the owners of the Philips Trust.
Read more:HSBC boss announces retirement
Go here for more financial news
Concerns about Philips Trust later emerged, including the movement of funds from lower to higher risk investments. Its customers faced potential investment losses, or had to pay for legal advice to remedy any issues with the trusts.
The Financial Conduct Authority said in March that the building societies were not responsible for the customers’ losses, but the three building societies all confirmed their intention to provide support to affected customers at their recent AGMs, and say today’s announcement “provides clarity around what that meaningful support means.” They said that, although they never had a relationship with Philips Trust and are not legally bound to offer financial help, they were doing so as part of their “purpose-led, mutual principles”.
(Image: Newcastle Building Society)
Andrew Haigh, Newcastle Building Society chief executive, said: “We are very concerned by, and sympathetic to, the difficult situation faced by people who have been affected by Philips Trust Corporation. It has been extremely distressing to hear the customer stories and the impact on their lives. Our members understand our commitment to purpose and our support for the communities we serve, which makes it even more important that we go ahead with this voluntary support for members at this time of great difficulty.”
Richard Fearon, Leeds Building Society chief executive, said: “These extraordinary circumstances require an extraordinary response and that is what we’re delivering. As a purpose-led, member-owned organisation I’m pleased to be offering this meaningful support, whilst balancing the interests of all of our members. ”
Sue Hayes, Nottingham Building Society chief executive said: “We have been working hard for a number of months to unravel the facts in this hugely complex situation. We would like to thank the many members that have supported our enquiries.
“We have been deeply saddened and frustrated to hear their stories and are truly sorry they have ended up in this position. Our focus now is on providing these voluntary payments as quickly as possible.”
People affected have been told they do not need to act at this stage, and will be contacted by Philips Trust administrator Kroll about the next steps in the process.
The building societies said the situation “remains complex, with more work required with Kroll to define and agree the process to enable the financial support to be paid.” But the financial support is expected to be substantial.
Original artice – https://business-live.co.uk/all-about/yorkshire-humber
