Collateral, a UK-based peer to peer lending platform, has reportedly gone into administration after trading without a proper license. According to various reports, a letter was sent to investors from the company’s administrator, named Gordon Craig, that stated the company was operating in the belief that it was authorized and regulated by the Financial Conduct Authority (FCA) under interim permission, but that was notably not the case and consequently has caused the lender to cease all lending activities. Craig has noted that the investments are safe and this is a procedural and compliance issue.
“I can confirm however that any monies that are sat on the platform and are not invested are ring fenced in a separate client account and the intention is for these to be returned to all investors after the Administrator has obtained control of the bank account and carried out a reconciliation.”
Since its launch in 2016, Collateral has notably lent nearly £17 million, with most loans were secured by property. Craig also noted that the Collateral team is currently into the website and the possibility of reopening in order for investors to view the balance of their investments. However, this isn’t something that will be dealt with until the next week at the earliest. Collateral’s platform currently reads:
“We are currently in the process of upgrading our serves and our network infrastructure. We apologize for the inconvenience and are working to get everything back to normal as soon as possible.”
Financial Times reported that the FCA stated it was “aware of the issue and working with the firm.”