The FCA has issued a public apology for delays in its investigation into peer-to-peer lending firm FundingSecure, its second apology issued in two weeks.
The regulator has written to former clients of the peer-to-peer lender who complained about the way it authorised and supervised the firm.
Buckinghamshire-based FundingSecure Limited went into administration in October 2019.
The FCA will make payments ranging from £50 to £250 to FundingSecure clients who complained to the regulator, in recognition of how long it took to respond to their complaints.
The regulator had been facing complaints that it should pay compensation to clients of FundingScore due to failures during the authorisation process.
Following an internal investigation, the FCA acknowledged that while losses suffered by complainants were caused when FundingSecure went into administration, and not as a result of its actions, it admitted that it should have done more during its assessment of the firm’s application for authorisation.
The FCA said in a statement this week: “Specifically, we should have done more to understand that FundingSecure Limited's business model had changed and that it had begun to offer property development loans.
“We should have also ensured FundingSecure Limited had an approved person responsible for client money at the time it was authorised.”
However, the watchdog did not uphold complaints about its oversight of the peer-to-peer lending firm once it became authorised. The FCA said it believed its oversight was reasonable and proportionate.
The apology is the second issued by the regulator to consumers in two weeks for delays in its investigations.
Last week the FCA publicly apologised to clients of two failed mini-bond firms for the way it dealt with their complaints about the firms and will also pay compensation. The regulator upheld complaints about its handling of mini-bond providers Basset & Gold plc and Basset & Gold Ltd, both based in the City of London.
The watchdog admitted after a lengthy investigation that there were “failures” in the way it dealt with the firms although it has rejected calls for substantial redress.
The FCA says it will not accept losses for redress as it was not the direct cause of investor losses but said it would pay £200 to each complainant, “in recognition of how long it took to respond to the complaints.”
Basset & Gold Ltd went out of business in 2021 and Basset & Gold plc in 2022.
