Capita PLC Connaught final settlement

 
TIDMCPI 
 
Capita concludes full and final settlement with FCA regarding 
 
                        Connaught Income Series 1 Fund 
 
Capita plc ("Capita") announces today that it has agreed a full and final 
settlement with the Financial Conduct Authority (FCA) regarding the Connaught 
Income Series 1 Fund (???The Fund"). Capita Financial 
Managers Limited ("CFM") was the Operator of the Fund until September 2009, 
when it was replaced by an unrelated company as Operator, following which CFM 
had no further involvement with the Fund. The Fund went into liquidation in 
2012 and its liquidator brought a claim against both former Operators, which 
for its part, Capita settled in 2016 for a sum of GBP18.5m. 
 
The FCA has been undertaking a formal review of the activities of both 
Operators and has announced today that it has concluded that CFM did not meet 
all of its regulatory requirements in the period April 2008 to September 2009. 
To ensure that investors receive appropriate redress and to bring this matter 
to a close enabling the smooth disposal of CFM, CFM and Capita have agreed a 
full and final settlement with the FCA. In reaching this settlement, the full 
cooperation which CFM has given to the FCA during the course of its 
investigation has been acknowledged. 
 
CFM has agreed to up to a further GBP66 million being made available for the 
benefit of the Fund's investors, with Capita agreeing to fund this amount. The 
FCA considers that this payment will be sufficient to return the amount 
originally invested, taking into account any interest, distributions and other 
payments that have already been received, with the intention of placing 
investors as closely as possible back into the position they would have been in 
if they had never invested in the Fund. Capita is expecting to make redress 
payments to the Fund's investors via the FCA and their agents during the first 
quarter of 2018. 
 
This settlement allows for the available funds to be directed towards the 
Fund's Investors. Given the circumstances, the FCA do not consider that it 
would be appropriate to require CFM to pay a financial penalty. 
 
As the FCA had previously indicated to Capita that it was minded to seek a 
financial penalty against CFM, Capita had made provision for the full potential 
amount of the financial penalty and associated legal costs (GBP37m). Based on the 
information available at that time it was not however possible to determine 
what the ultimate outcome of the FCA investigation would be. 
 
Capita completed the disposal of its Asset Services businesses, including CFM, 
to the Link Group on 3 November 2017. 
 
                                    -Ends- 
 
Notes: 
 
 1. The FCA has stated that it is appointing an agent to carry out the 
    calculation and distribution of monies to investors. It is not necessary 
    for investors to take any further action at this time. The FCA or its agent 
    will contact each investor with an outstanding claim against the Fund with 
    more details shortly. 
 
 2. Capita is a leading UK provider of technology enabled customer and business 
    process services and integrated professional support services. With 67,000 
    people at over 500 sites across the UK, Europe, India and South Africa, 
    Capita uses its expertise, infrastructure and scale benefits to transform 
    its clients' services, driving down costs and adding value. Capita is 
    quoted on the London Stock Exchange (CPI.L). Further information on Capita 
    can be found at: http://www.capita.com. LEI no. CMIGEWPLHL4M7ZV0IZ88. 
 
This announcement contains inside information. 
 
For further information: 
 
Capita plc Tel: [phone] 
Andrew Ripper, Head of Investor Relations 
Fiona O'Nolan, Director, Corporate Communications 
[e-mail] 
 
Media enquiries: 
 
Powerscourt Tel: [phone] 
Peter Ogden and Andy Jones 
[e-mail] 
 
 
 
END 
 

(END) Dow Jones Newswires

November 10, 2017 02:18 ET (07:18 GMT)