Investors on failed peer-to-peer lending platform Lendy have discovered that their money was not ring-fenced as promised.
Administrators told Lendy investors, who are owed more than £150m to brace for a bigger hit than expected, as any money would be used to pay off insolvency practitioners and creditors.
One of the principles of P2P lending is that investors’ money should be protected in the event of platform failure and not used to pay debts and fees.
Lendy began crowd-sourcing funds from retail investors to write secured loans to property developers in 2014 and collapsed in May.
