Law firm Leigh Day is considering legal action against Football Index for customers who lost money because of the product’s collapse.
Football Index entered administration last week, and it is currently unclear as to whether traders will be able to get back their investment money.
The UK Gambling Commission (UKGC) has suspended Football Index’s licence and calls have been made for an investigation into the company’s regulation.
“There are serious questions that will need answering”
Leigh Day’s claim will be made available to all Football Index customers. The platform’s terms and conditions state that Football Index’s funds were kept in a different account to that of parent company BetIndex.
When it comes to customer funds, however, player shares are “not stored in any account or otherwise protected as they are sums at risk”.
However, it has been said that there is “no guarantee that all funds will be repaid in the event of insolvency”. This is despite the existence of trust agreements to protect this money.
Commenting on the current situation, Leigh Day partner Nicola Marshall had the following to say.
“Following the suspension of their betting licence, Football Index have suspended the platform leaving individuals unable to withdraw their money.
“An administrator has been appointed. We will be investigating whether Football Index was distorting the product they were offering to consumers.
“Whilst it is very early days in our investigations on behalf of the thousands of people who have lost money, there are serious questions which will need answering regarding what has happened at Football Index and what the Gambling Commission understood of Football Index’s activities.”
“Our priority is to safeguard the interests of our customers”
Football Index has also commented on the situation. A company spokesperson said: “Our priority is to safeguard the interests of our customers and to seek the best outcome for our community with the goal of continuing the platform in a restructured form.”
Since Football Index’s collapse, cross-party parliamentary MPs have written to Culture Minister Oliver Dowden. They want an inquiry into the company’s regulation, and why it was allowed to fail.
John Whittingdale, the country’s gambling minister, has reportedly held “frank” discussions with the UKGC about Football Index and its demise.
Football Index’s administration process will begin on Thursday in a Jersey court. The company is currently searching for an investor, and has stated its wishes to revive the platform if help can be found.