North Yorkshire Credit Union was placed into liquidation following an order of the High Court on Wednesday (October 31) with Kevin Murphy and Richard Toone from Chantrey Vellacott DFK appointed liquidators.
The not-for-profit financial co-operative, which had its offices on Holgate Road, York, was initially formed in 2006 and was open to anyone who lives, studies or volunteers on a regular basis in York or in the county of North Yorkshire.
It was owned and controlled by approximately 5,000 members with investments totalling around £1.9 million.
Mr Murphy has stressed that all savers will be compensated in full.
Mr Murphy said:
Every member of the North Yorkshire Credit Union will get their money back in full within the next week, as they are protected by the Financial Services Compensation Scheme (FSCS).
The FSCS has confirmed this process is automatic, so members do not need to act to get their money back. People with less than £1,000 will receive a letter to get cash over the counter at the Post Office, while anyone with more than £1,000 will receive a cheque.
The collapse of North Yorkshire Credit Union is due to a combination of factors. This includes bad debt provisions in respect to loans to members of over £400,000 due to inadequate credit referencing and credit control, and also inadequate cost control, which is partly due to the resources required to service the large North Yorkshire region.
Under the terms of appointment as liquidators we are in the process of reviewing all of NYCU’s assets and winding up the organisation.