LENDY investors have been told by the collapsed platform’s administrator that they will be restricted from making withdrawals “until further notice”.
RSM was appointed as administrator of the beleaguered P2P property platform last month and has written to investors to say their accounts remain open but funds cannot be withdrawn due to the ongoing restriction on payments from the Financial Conduct Authority (FCA).
“The administrators are currently reviewing the Lendy loan book with a view to effecting an orderly wind down,” RSM said.
“We are working with the borrowers and enforcement agents to realise the assets and maximise returns to investors.
“The investor’s online accounts will remain open, however there will be restrictions on withdrawing funds until further notice”.
RSM said it hoped to provide an update on payments by the end of this week.
The administrator also revealed that Lendy had been subject to FCA special measures, an issue the platform regularly declined to comment on, since November 2018. It said the rationale for its appointment was that there was a “real risk” risk that liquidation would “fundamentally damage” the value of the company’s assets and undermine the return to creditors.
The document from RSM said it is too early to say how much money will be returned to creditors and investors.
All borrowers will be contacted directly and will be assessed for their ability to repay at the appropriate maturity dates or earlier, RSM said.
The announcement followed months of speculation over the state of Lendy’s accounts. Last year, one borrower threatened to sue the platform and its investors for £10m, claiming that Lendy unfairly placed £8.2m of its debts into default.
The FCA has been keeping a close eye on Lendy’s activities in recent months, and confirmed in April that it had placed restrictions on the platform.
Just last month, a number of senior staff departures led to speculation that the company could be breaking up.
In early May, Lendy’s co-founder Liam Brooke and former chief operating officer Robert Kelly launched a new company which offers cash advances to employees.