Not upheld: payment delay/distribution of funds complaint against Crowdcube Capital Limited

Decision detail

Summary

Mr E complained that Crowdcube delayed distributing funds from a share sale exit by approximately 28 days, when he believed payment should have been made within 24 hours of completion on 1 April 2025. He sought compensation of £80 for lost interest and opportunity costs. Crowdcube defended the delay as necessary to comply with regulatory and legal obligations including AML checks and reconciliation processes. The ombudsman found that Crowdcube reasonably undertook required compliance processes and did not cause avoidable delays, particularly given that the final shareholder list was not received until 28 March 2025. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Crowdcube reasonably undertook regulatory and legal processes including AML checks and consolidation exercises to ensure accurate and compliant payments to all investors. The delay in receiving the final shareholder list until 28 March 2025 meant the required processes could not commence earlier. The ombudsman accepted that transactions of this nature require delays between receipt and distribution of funds, and that the processes undertaken were necessary and reasonable. Bank holidays also contributed to the timeline. The ombudsman rejected the argument that AML checks take only minutes or that payment should have occurred within 24 hours, finding these expectations unrealistic for a transaction involving multiple investors and regulatory requirements.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website