FUNDINGSECURE investors and creditors have backed proposals for the collapsed peer-to-peer lending platform’s administrator to seek legal advice on who is entitled to which assets.
CG & Co, which is managing the administration of FundingSecure, warned last month that legal clarity is needed as it found loans to borrowers were “from time to time” a mixture of client and company money and it is unclear who owns some of the assets and who is entitled to any money gained from their realisation.
There was also backing to set up a creditors committee of investors and creditors to oversee the administration.
Members can be nominated and will be chosen based on the value of their investment or claim.
The administrator’s report last month uncovered issues with FundingSecure’s client money account and also found many of the loans described as ‘performing’, actually had loan extensions from FundingSecure so may be in default.
CG & Co said it is too early to provide an estimated outcome for investors or creditors.
This is due to the client money failures and the terms and conditions leaving it unclear who is entitled to what.
FundingSecure entered administration in October, which CG & Co attributed to ongoing litigation that the platform could no longer afford to support.