The Financial Conduct Authority (FCA) will not be providing an update on its investigation into collapsed peer-to-peer lending platform Collateral until the end of the year, Peer2Peer Finance News understands.
In May, FCA chief executive Nikhil Rathi told the Treasury select committee of MPs that the investigation into Collateral, including a potential hack into the regulator’s register, was very close to a conclusion and that he hoped to provide another update by September.
While the investigation is understood to be progressing at pace, the City watchdog now hopes to make a statement towards the end of the year.
There is thought to be no particular reason for the delay, just the time needed for the regulator to follow due process with its enforcement work.
Collateral – a P2P pawnbroker and property lending platform – collapsed into administration in February 2018 and entered into liquidation in April 2019.
According to The Times, Collateral told prospective investors it held an “interim permission” for regulated activities and the FCA’s register showed this appeared to the case, but someone changed the name on Regal Pawnbroker, a separate business where Collateral’s founder Peter Currie was a former director, to make it look like Collateral held the permission instead.
Rathi told the Treasury committee in May that this specific issue had been tightened very considerably and the FCA was investing to keep ahead with cyber security.
He said at the time that he hoped to give a very substantive update on the Collateral investigation by September.
“What I would say is that they are very close to coming to a conclusion,” Rathi said at the committee hearing.
“The enforcement investigation is at an advanced stage. I am not going to comment too much further because one element of it is a criminal investigation, but they are at an advanced stage.”
The administration process has been complicated and lengthy, with many Collateral investors still waiting to recoup some of their funds.
In July, Collateral’s administrator BDO said it was seeking legal advice on setting a deadline for claims from investors before it can start repaying money owed.
BDO had previously highlighted issues with matching investor funds to loans and recovering money that has been lent.
Its latest liquidation update revealed that a “limited number” of investors disagree with BDO’s analysis of their loan exposure.
BDO said it has asked investors to provide proof if they think they are owed money and it is also seeking legal guidance on setting a deadline for when investors can make claims.
It said that payments can only be made to investors once this is resolved.
The FCA declined to comment.