IG Group latest to receive FSA compensation bill

27th Jan 2011 13:24

Spreadbet firm IG Group has one month to pay £4m into the Financial Services Compensation Scheme to help refund retail investors who lost money they had in firms that collapsed last year.The invoice is in addition to the £1m provisioned for and, although the company is certainly able to afford it, could put rumoured plans for a special dividend on the backburner.Analysts at Panmure Gordon, which will make its own contribution to the kitty, have cut earnings estimates for 2011 by 2%, lowering profit estimates by £4.4m to £166.4m. "Given this is an unforeseen regulation-driven expense over which management has limited visibility, we expect management will now be more conservative with respect to the minimum level of surplus capital that is maintained for expansion capex and growth working capital," the broker said in note to clients Thursday.IG is not the only one having to fork out much more than expected to cover the failures of Keydata Investment Services - it went bust after selling fake bonds - and Wills & Co - fined £1.5m by the Financial Services Authority (FSA) for mis-selling.Fund manager Brewin Dolphin has been billed for £6m, Rathbone Brothers £3.6m, Charles Stanley £2.6m and Evolution Group £1.4m.But the scheme needs £326m to meet the cost of reimbursing investors up to the maximum £50,000. More invoices will be landing with a thump on doormats across the City shortly.