Crown Currency Exchange which is one of the UK's largest travel money businesses, have left thousands of holidaymakers without any travel money after its bank accounts were frozen by Barclays bank.
As fears grow that an administrator is likely to step in to identity and establish what went wrong and to get an understanding on Crown Currency Exchange current situation. An administrator is standing by to be appointed should the company go into liquidation.
Crown Holdings (London) Ltd is registered with the Financial Services Authority under the Payment Service Regulations 2009 (register reference 503404) for the Provision of payment services.
Which means that there is more pressure on the FSA to get the control of the Payment Service Regulations right. The main question is are consumers funds protected as based on the current requirements
Large companies specialising in money transfers must keep consumers' money separate from their own funds in case they go bust. So has this been the case and if not why not and has the company acted in an improper manner?
Barclays bank, which did not provide it with any foreign exchange services, has a legal obligation to freeze accounts in such instances to protect any funds on behalf of its creditors.
It is not known how much money is in the company's bank accounts, or whether customers will be repaid in full. The company's website, which was still operational yesterday, allows customers to transfer between £300-£10,000 into a choice of 80 foreign currencies at dates up to 12 months in the future.
Crown Currency Exchange operate several websites crowncurrencyexchange.com and travelmoneyservices.co.uk which boasts it is the "home of the best foreign exchange rates", was barred from withdrawing or transmitting any money to its customers after Barclays stepped in as it was understood to have acted to freeze the accounts after the company's directors told the bank it was in trouble.