A CREDIT union has plunged into administration, leaving hundreds of customers unable to use their accounts.
Waltham Forest Council Employee Credit Union (WFCECU) was placed into administration on Tuesday and has now stopped trading.
Hundreds of people use the credit union and should have their money paid back to them[/caption]
Joint administrators from Quantuma Advisory Limited have stepped in to take control of the firm’s assets and operations for now.
Fortunately, there’s no need for members to panic, as protection under the Financial Services Compensation Scheme (FSCS) means everyone gets their savings back.
All accounts, up to the £85,000 limit per individual, are fully protected.
Your money will be returned within seven working days of when the firm collapsed into administration – so you’ll get it by August 28.
Dina Devalia from Quantuma Advisory Limited said: “You don’t need to do anything to get your money back.
“Anyone with a deposit with the credit union should look out for a cheque in the post from the FSCS in the next few days.
“We are working with the FSCS to ensure that eligible members receive their money back as soon as possible.”
Credit unions provide loans, savings, bank accounts and other services to their members.
They’re designed to help the community rather than make money and often accept people who’ve been turned down for accounts and loans elsewhere.
Waltham Forest Council Employee Credit Union Limited had a total of 675 members.
It had served customers in the London borough of Waltham Forest.
Can I still use my account?
Normal operations like withdrawals and transfers are usually paused or restricted when a firm falls into administration.
It’s not yet clear when or if you’ll be able to access your account to transfer your funds.
You should contact the joint administrators before trying to move or withdraw your funds.
How do I get my money back?
You don’t need to do anything as you should get your money automatically.
The FSCS said people should get their money by cheque in the post in the coming days.
But if you believe you have money in an account with WFCEC and you haven’t got a cheque by August 29, you should contact the joint administrators.
You can contact them using this email address: [email protected].
Or you can phone them on 07469 278 739 or 020 3856 6720.
Alternatively you can get in touch with the FSCS.
You can email them on [email protected], or phone them on 0800 678 1100 or 020 7741 4100.
The phone lines are open Monday to Friday from 9am to 5pm.
What if I have a loan?
If you have a loan agreement with the credit union, you shouldn’t cancel any repayments.
The loan agreement will remain in place and repayments need to be made as originally contracted.
Future loan repayments will be managed by the joint administrators and they will be providing the administration bank account details soon.
If you made payments covering both loans and savings, the joint administrators will tell you the new amount to pay each month so that you do not fall into arrears.
You can contact the administrators for more information.
Is my money safe?
Your money is completely safe.
Over 73 credit unions have gone under in the past decade.
Matt Bland, head of policy at the Association of British Credit Unions (Abcul), said previously: “We do unfortunately see a number of credit unions fail each year.
“Typically the credit unions that do fail are very small, with a few hundred or maybe a thousand people using them.”
But regulations are in place to act as a safety net.
What to do if you don’t have another bank account
If you don’t have another bank account, it’s important to act quickly.
You’ll need to open an account with a bank, building society, or credit union so your payment can be processed and you can access your funds.
For those who prefer to stay with a credit union, you can find information about alternative options through the Association of British Credit Unions Limited (ABCUL) website .
If you’re based in Scotland, the Scottish League of Credit Unions website provides useful resources and information about credit unions in your area.
If you’re unsure where to start, your local Citizens Advice Bureau can help you open a bank account.
You can also visit your nearest high street bank or building society for assistance.