Financial Conduct
Beaufort Securities and Beaufort Asset Clearing
RNS Number : 4726G
Financial Conduct Authority
02 March 2018

Beaufort Securities Limited (BSL) and Beaufort Asset Clearing Services Limited (BACSL) are placed into insolvency

Following an urgent application by the Financial Conduct Authority (FCA), the High Court has appointed Messrs Russell Downs, Douglas Nigel Rackham and Dan Yoram Schwarzmann of PricewaterhouseCoopers (PwC) as joint administrators of BSL and joint special administrators of BACSL.

The FCA took this action following an assessment of the financial positions of BSL and BACSL (the Firms) which led the FCA to believe that both Firms are insolvent. The FCA also considers it necessary for insolvency practitioners to take over the running of the Firms in order to protect assets from dissipation and protect the customers of both Firms.

The FCA has also imposed requirements on the Firms, with immediate effect, using its own-initiative powers under the Financial Services and Markets Act 2000 (the Act), requiring the Firms to cease all regulatory activity and not to dispose of any firm or client assets without the FCA's consent.

The joint administrators / joint special administrators will contact all affected customers of the firms in due course. If customers of the Firms require more information about how they will be affected, they should contact PwC (contact details will be made available by PwC through the day).

Gold Bars are less trouble CD.

I guess we need to spread our portfolios across several brokerages.

The takeover of HMSO by a French outfit was called off yesterday, so no risk of my suddenly acquiring a load of cash which PWC could raid. On the minus side, the shares plummeted almost back to where they were, without my having the opportunity to sell.

There are a couple of other shares I would like to have banked some profits on too. Actually, being forced to leave them alone has probably worked out in my favour (as long as i do eventually get the shares back, obviously).

My thought too. Got open another couple of accounts at least. The time line before we get access to our stock is a worry.

The lack of trading opportunity is one of the major problems plus as PwC are raiding the stocks as well, the problem also arises on the day they set the bar!

So, how much they will take by payment by selling stocks that may have plunged but could rapidly rise in between is another matter. In addition it seems they have a lot that are next to worthless to trade at the time the bar maybe set, and how they deal with these that even a week later could be well worth a reasonable amount is questionable.

At first they said all securities would be returned around mid April/May, now we have the situation where they will feed on them until they have nothing worthwhile left, so leaving claims to the FSCS. Would the FSCS not be better just picking up the bill up to £50k and getting them to return stocks to designated brokers, in the same manner as they are returning up to £2k in cash.

How does the system ensure that the administration is expedited?

Not good reading.

CD

".....as PwC are raiding the stocks as well......"

on what authority exactly?

There must be a clear distinction between Beaufort's own assets and the assets of the clients, whether held on an execution-only or on a discretionary basis.

One does wonder what has occurred since PWC's first statement and the latest one to account for the change of approach, especially as they had already stated that Beaufort's systems had appeared to have been functioning in a satisfactory manner.

The first formal client meeting will no doubt be interesting, not to mention any subsequent court proceedings......

55011 - they will get the Court to rubber stamp their raids on clients assets, regardless how held - that's what professionals do, and that is what the courts are there to do, help themselves to others funds, and wow betide anybody that challenges them - they land you with huge costs as they sit in Court at anything from £400 - £1000.00 an hour each.

The parasite system operates in this way, and they are all party to seeing anyone go broke on the back of it. All done under the name of the Crown of course.

If you were a supplier of a retailer that went broke and could prove that the goods were yours and had not been paid for by the company, you could claim them, if you left goods to be repaired, you could also claim the goods but it seems that unless they face a challenge in court they can raid your assets in Beaufort as they wish.

Seems to me there is no incentive for anyone to act smartly, quickly or with common sense here.

Lots of very expensive people can drag it out as long as they wish, at our expense, and (inasmuch as we are covered by FSCS) that of the taxpayer. And at the end of it all, when they (and we) are all old and grey, they can all pat each other on the back saying how thoroughly they complied with their compliance policy in terms of compliance and their thoroughly complying with same, and how much they are looking forward to a secure retirement.

I bet if they were paid on a lump sum fee basis, it'd be sorted by now, and very few people would have lost anything.

This country, and its "system" needs a jolly good boot up the arse.

Those with assets above 50k seem likely at best to get only 60% back. See info dated 20.04.18

https://www.pwc.co.uk/business-recovery/administrations/assets/beafort_noticeofproposalsandmeeting_20180420.pdf

Tear up at the meeting on the 10th May.

We should learn more on Wednesday when they publish their draft proposals, including their suggested 'sliding scale' whereby larger portfolios are raided at a lower % rate than small ones, but still suffer a higher absolute ££ withholding.

Unless their proposals are totally unreasonable, or affect me very adversely, I will likely vote in favour as I suspect a 'no' vote could delay things for many more months.

The "proposals" to be published on Wednesday may well be further developed - for better or worse - by the time of the meeting. No less important will be what is formally stated at that meeting and the responses to any matters raised.

Without belittling the work necessarily to be done - it does look at this stage as though the slowest ship is going to be dictating the pace of the whole convoy....

Active execution-only clients may especially feel this way and be very keen to point to past precedents whereby such accounts were simply transferred quite swiftly to another broker. What is the point of the supposed "ring fencing" of client holdings/funds otherwise?

I am expecting PWC/FCA to be called upon for a lot of explanations in public on the day - if not informally taking place already.

It would be quicker and cheaper for the FSCS to cover the costs of transferring execution only client accounts that are valued below 50k to other brokers without delay, than assisting PwC to drag the the process out. All they have to do is agree a figure with PwC and allow clients to get on with the accounts that they have said were ring fenced., and as you say what is the purpose of ring fencing if the FCA rules allow this sort of abuse of clients assets.

Hopefully, those clients will turn up to the meeting when held and make there presence felt, and contact the FCA/FSCS before hand to make their position clear.

Far too sensible, clock.

We know they do not do sensible commervan, as they all seem part and parcel of the same parasitic group that are hell bent on ensuring that they and the so called "professionals" (including lawyers and accountants) are richly rewarded through the criminal actions and abuse of others, leaving those who have, so called protected assets high and dry, and then they stop you getting your hands these securities, so they can milk the situation for an extended period of time, keeping themselves all in highly paid jobs for a longer period of time.

How long before the legals turn up touting for a class action? On the info so far I reckon they'd hook a fair few....

Proposals on the website this morning as promosed. A rather long read, but actually not much in the way of new info.

As you say commervan, a long read but they seem to be on top of the situation now.

Although it is going to take time, there are positives for those with securities under £50k and it seems these should at least be sorted by September, without the need to formally claim through the FSCS for the bulk of clients, as it appears these will be dealt with through PwC , having just had a brief quick read of the document.

https://www.pwc.co.uk/business-recovery/administrations/assets/beaufort_proposals_20180424.pdf

Hopefully clients will be able to see their portfolios some time in May, and be able to check if they have been secured correctly.

May. I have not had time to read updated proposal. Hope its true about sorting this mess out.