UK’s protection scheme unable to cover expats in Portugal

Expats in Portugal that invested their savings in Premier FX risk losing it all as Financial Services Compensation Scheme (FSCS) has announced it is not allowed to protect money held with the company.

Premier FX Limited was only ever permitted to carry out certain payment services known as “money remittance”. However, Premier FX was found to be acting outside of the boundary of these permissions by also holding customer money in their accounts.

The FSCS is the UK’s statutory Deposit insurance and investors compensation scheme for customers of authorised financial services firms. This means that FSCS can pay compensation if a firm is unable, or likely to be unable, to pay claims against it. But not in this case.

FSCS cannot protect money customers held with Premier FX Limited because the firm was not authorised by the FCA to hold customer money in its accounts. This means FSCS will be unable to compensate for any shortfalls in customers’ money held by Premier FX Limited.

Set up in 2006, Premier FX specialised in helping expats buy property and transfer money abroad. It went into administration on 13 August, as reported by International Investment.

The FCA said it is working closely with administrator PKF Geoffrey Martin & Co to ensure that customers are treated fairly.

The administrators are currently carrying out their statutory investigations into Premier FX and have asked that customers send details of their agreements, confirmation of the total funds sent, a detailed breakdown of payments and the accounts into which the money was paid.

A Facebook group has been created for people who used Premier FX and cannot access their money.

Pedro Gonçalves
Pedro Gonçalves is Financial Correspondent at International Investment.

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