Is a charity covered if the bank or building society it holds money with fails?
If a bank or building society authorised by the FSA is unable to pay back deposits held with it, the FSCS can pay 100% of the first £50,000 of an eligible depositor’s claim, per authorised institution. FSCS protects private individuals and some small businesses. Whether a charity is covered will depend on how it is constituted. There is no requirement for charities to be established by way of a particular structure or form. According to section 1 of the Charities Act 2006, a “charity” is simply an institution established for charitable purposes only, which is subject to the control of the High Court in the exercise of its jurisdiction with respect to charities. There are as many permutations of charitable structures as there are types of legal personality. As charities are not specifically provided for in the eligibility rules of the COMP Sourcebook, their eligibility will be determined by their structure and legal personality. For example, a charity can be constituted as a limited com
