Investors in failed mini-bond firm London Capital & Finance (LCF) have withdrawn their judicial review appeal against the Financial Services Compensation Scheme (FSCS).

In an update on its website, the FSCS said: "On 29 March 2021 we shared the news that the court had reached a decision on the judicial review that was brought against FSCS by some LCF bondholders.

"The claimants then filed an appeal but have now announced that they have withdrawn this appeal.

"This brings the legal challenge against FSCS to a close."

Some 11,625 investors lost savings worth a total of £237m when LCF collapsed with the majority so far not compensated by the FSCS due to questions about whether their investments were regulated or not.

In March LCF investors were given the right to have their case heard in the Court of Appeal after a judge decided not to overturn the FSCS's decision only to compensate a minority of LCF investors.

Around 97% of all LCF bondholders invested less than £85,000 and therefore will not reach the compensation cap under either the government compensation scheme or the FSCS.

The government expects to pay out around £120m compensation to around 8,800 people in total.