Worcestershire-based Credit Union Castle & Crystal Credit Union has been placed into administration and declared in default by the Financial Services Compensation Scheme.
The credit union, which has 7,173 members, ceased trading on 21 May and James Sleight and Peter Hart of PKF Littlejohn Advisory have been appointed as joint administrators.
The Financial Services Compensation Scheme Limited (FSCS) said it expects the total compensation for members to be around £2.6m, with most members compensated within seven days.
On its website, the FSCS said: “As a Castle & Crystal Credit Union Ltd customer, you don’t need to worry, as your money is safe. FSCS will automatically pay back your money, according to the account details we receive from the credit union. We’ll contact you by post.”
Most members will receive a cheque, while a small portion of will receive a letter to allow them to get cash at any Post Office branch.
The compensation process will take longer for members whose contact details are missing, the FSCS added.
Castle & Crystal launched in 1993 as Dudley MBC Employees Credit Union Limited, operating for the benefit of Dudley Council staff. It changed its name after expanding its common bond to everyone living or working in the Dudley, the county of Worcestershire and to partner organisations.
