A PROBE into the mis-selling of split-capital investment trusts in Guernsey has not been delayed. Guernsey Financial Services Commission director general Peter Neville said that reports in the Financial Mail on Sunday that the UK Financial Services Authority was to abandon the two-year investigation were ‘misguided’.

The FSA delayed a summit, planned for Monday, with companies involved in the split-capital investment trust scandal after some businesses refused to take part in compensation talks.

But Mr Neville said that the GFSC inquiry was continuing.

‘Our approach is unchanged. We are liaising with the Financial Services Authority and the Jersey Financial Services Commission to look at various issues arising from the split-cap problem.

‘Our inquiry is focusing on the management and corporate governance of Guernsey-domiciled split-cap investment trusts and on the suitability of the advice and recommendations made to investors by Guernsey intermediaries.’

Mr Neville said that the inquiry was complex but should be completed by the end of the year.

Although it involved a ‘fair amount of overlap’ between the GFSC, the UK and Jersey, the outcome of the Guernsey inquiry would depend completely on what was uncovered by the FSA inquiry.

The commission was taking legal advice on what action could be taken once it is concluded.

The FSA aims to get compensation for people who lost out and to help rebuild confidence in the £58bn investment trust sector.

Investors lost at least £667m. during the splits scandal in zero-dividend preference shares, which were widely marketed as low-risk investments.