Investors could face a longer wait to get their money back from collapsed peer-to-peer lender FundingSecure, as documents reveal its administration needs to be extended.
CG&Co was appointed administrator of FundingSecure in October 2019 and said in its progress report released this week that it will seek permission from creditors for an extension. It said more time is needed to realise assets and noted the impact of the coronavirus pandemic on the property market.
The report said that as of the end of May 2020, £11.9m has been recovered out of total investments of £67.5m so far.
Of this, £114,033.73 is currently being held as a borrower raised a complaint relating to the security and appointment of receivers. These funds cannot be released at this stage.
At the onset of the administration, CG&Co said, FundingSecure had 470 loans on 242 assets of which 379 had been deemed performing and 91 defaulted.
Since then, 165 are in default and just six are performing.
CG&Co said it had reconciled issues relating to client money accounts and £10.2m of withdrawal requests have been processed.
The document revealed that secured creditors have agreed that investors can benefit from any realisations as there was a concern about their legal status.
It also revealed that legal action relating to inappropriate allocation of investor money and a separate claim regarding fraud on a portfolio of art loans has been sold to litigation funders and the company will share in the proceeds of the claim if successful.