Bullshare
- 02 Mar 2018 07:28
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).
commervan
- 16 Apr 2018 17:55
- 41 of 135
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.
Clocktower
- 23 Apr 2018 13:17
- 42 of 135
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
Claret Dragon
- 23 Apr 2018 14:43
- 43 of 135
Tear up at the meeting on the 10th May.
commervan
- 23 Apr 2018 18:03
- 44 of 135
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.
55011
- 23 Apr 2018 19:33
- 45 of 135
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.
Clocktower
- 24 Apr 2018 13:12
- 46 of 135
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.
commervan
- 24 Apr 2018 13:39
- 47 of 135
Far too sensible, clock.
Clocktower
- 24 Apr 2018 13:49
- 48 of 135
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.
55011
- 24 Apr 2018 16:50
- 49 of 135
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....
commervan
- 25 Apr 2018 08:59
- 50 of 135
Proposals on the website this morning as promosed. A rather long read, but actually not much in the way of new info.
Clocktower
- 25 Apr 2018 10:52
- 51 of 135
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.
Claret Dragon
- 25 Apr 2018 14:06
- 52 of 135
May. I have not had time to read updated proposal. Hope its true about sorting this mess out.
Claret Dragon
- 08 May 2018 11:28
- 53 of 135
Thursday meeting will help get a better idea of how this is going to pan out.
CC
- 08 May 2018 11:42
- 54 of 135
https://www.sharesoc.org/sharesoc-news/sharesoc-demands-fair-treatment-for-beaufort-clients/
Part of the article.
On 15th March, PwC confirmed that the ringfenced property of the Group’s clients was held appropriately in accordance with FCA requirements, being approximately £50million in segregated client money accounts and around £850million in client-owned securities. On the 12th April, PwC noted that client money and client assets were, as at the date of administration, substantially complete save for a very small number of isolated deficiencies. However, the initial estimate of £850 million client assets was reduced to £500m as a result of illiquid / nil value positions. The special administrator stated that the majority of client asset returns will commence September 2018 at the earliest and that around 700 clients with assets valued over £150,000 may experience a loss up-to a maximum of 40% on their ring-fenced assets!
PwC is proposing to charge an incredible £100 million for the wind-down over a period of 4 years. They have provided no justification of either the amount or timeframe for the simple task of transferring an electronic registry of client assets/money to one or more replacement brokers.
ShareSoc has launched a campaign with the primary purposes of mounting a legal challenge to the current administration proposals, specifically:
Refuting the Special Administrator’s right to seize ringfenced client property
Ensuring proper separation of the liabilities of BSL from those of BACSL
Questioning the Special Administrator’s cost and time estimates in relation to the wind-down of BACSL
Seeking a transfer of the business of BACSL to an alternative custodian
Reviewing the actions and motivations of the FCA in this matter
Lobbying for legislative change to ensure that assets in custody are properly protected
Clocktower
- 08 May 2018 17:13
- 55 of 135
Good Luck to Sharesoc, and hopefully they will receive a huge amount of support from all those that have funds tied up in Beaufort, be it in cash of any other securities. The FCA have acted in a a deplorable manner and have not ensured that so called protected assets are transferred expediently to their rightful owners, when falling below their £50k warranted figure, and just reimbursing PwC for sanctioning the transactions. Further more to allow PwC to rip off ringed fence stocks regardless of value is disgraceful, when as Sharesoc states could easily be transferred to another custodian with ease.
Liquidators will not generally resign even when asked to do so, and the courts support them even when asked to remove them, and allow them to get paid for fighting them.
It is well worth reading a few judgement where cases have been brought to the Courts, as the Courts consider them to be their own:
“Moreover, the court does not lightly remove its own officer and will, amongst other considerations, pay a due regard to the impact of a removal on his professional standing and reputation.”
In AMP Ordinary Type Music Box Enterprises Limited v Hoffman (2003) 1 BCLC 319
"On the other hand, if a liquidator has been generally effective and honest, the court must think carefully before deciding to remove him and replace him. It should not be seen to be easy to remove a liquidator merely because it can be shown that in one, or possibly more than one, respect his conduct has fallen short of ideal. So to hold would encourage applications under section 108(2) by creditors who have not had their preferred liquidator appointed, or who are for some other reason disgruntled. Once a liquidation has been conducted for a time, no doubt there can almost always be criticism of the conduct, in the sense that one can identify things that could have been done better, or things that could have been done earlier. It is all too easy for an insolvency practitioner, who has not been involved in a particular liquidation, to say, with the benefit of the wisdom of hindsight, how he could have done better. It would plainly be undesirable to encourage an application to remove a liquidator on such grounds. It would mean that any liquidator who was appointed, in circumstances where there was support for another possible liquidator, would spend much of his time looking over his shoulder, and there would be a risk of the court being flooded with applications of this sort. Further, the court has to bear in mind that in almost any case where it orders a liquidator to stand down, and replaces him with another liquidator, there will be undesirable consequences in terms of costs and in terms of delay.”
https://www.jerseylaw.je/judgments/unreported/Pages/[2012]JRC021.aspx
Clocktower
- 14 May 2018 13:09
- 56 of 135
See emails from PwC.
commervan
- 15 May 2018 08:50
- 57 of 135
Haven’t had anything from them yet this week, but on Friday i got access details to the portal, and was able to go in and confirm my cash balance and share holdings are present and correct. Apparently they will be in touch with me again in due course. How nice.
Claret Dragon
- 15 May 2018 09:28
- 58 of 135
I also logged on. All got a bit messy last Thursday. So much for ringfencing.
Clocktower
- 15 May 2018 10:51
- 59 of 135
I have not tried getting into the Portal yet CD, as I am traveling and have intermittent connections but can you explain why it is messy before I try logging in please?
commervan
- 15 May 2018 12:22
- 60 of 135
.....or was CD talking about the meeting on Thursday?
I wasn't able to attend, and haven't seen/heard anything about how it went, although the write-up on the website suggests resolutions were passed, thereby approving their proposed plans. It also seems they were on the defensive regarding their costs, suggesting there was a strong challenge during the session.
Amongst all the other unfairnesses about this whole fiasco, it stuns me that the government are rubbing salt into our wounds by charging VAT on the already outrageous costs of sorting out the mess which THEY (through the FCA) should have prevented. A chunk of the money paid out by individuals who lost money, and by the FSCS, will be going back into government coffers.