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Funding Empire suspends loans until FCA approval
Funding Empire has advised lenders that they will not be issuing any new loans until they have received full authorisation from the FCA which is expected in January 2017. Funding Empire have also been sold back to the founding team, who should a majority stake holding to Paratus AMC Limited in July 2015.
Should lenders be concerned with either development? At this stage lenders should not overly be concerned. It is likely there is a question mark over FCA authorisation otherwise the platform would not have suspended lending back in September, however companies are required to provision for running down the business in a controlled manner. The takeover of Funding Empire when new loans are not being issued possibly indicates that Paratus AMC Limited did not see a way forward to realise Funding Empire's value in its current form.
Here is the email sent to lenders yesterday evening:
Further to our last communication on 22/09/16, this is to let you know that we have now completed a management buyout, and that the founding team have acquired all shares held by Paratus AMC Limited and are once again the sole owners of Tally Marketplace Lending Limited (Tally), the company which operates the ‘Funding Empire’ platform.
Please rest assured that this will not at all impact the service you receive as a lender on the ‘Funding Empire’ platform and we will continue to service your current loans as we have always done. However, we will not be issuing any new loans until we know the outcome of our FCA application which is expected in January 2017. This is an internal decision that was made by the management team.
If you have any questions about this, please email me and I will endeavour to reply to your questions where possible.