In the unlikely event that we become insolvent, your money and investments would be returned to you as quickly as possible, or transferred to another provider.
This is because your money and investments are held separately from our own. Any funds you own with us are registered in a nominee account and held in accordance with FCA rules. And any cash you hold with us is held in trust accounts at an authorised bank in accordance with FCA rules.
So if we were to become insolvent, an insolvency practitioner would be able to identify all the assets belonging to you and other investors and make sure they remain fully protected until returned to you or transferred to another provider.
Administration costs - in the event of insolvency
In certain circ*mstances following the insolvency of a firm, the appointed insolvency practitioner may be entitled to utilise a proportion of assets and/or your client money to cover administration costs associated with returning or transferring your investments. You may be entitled to compensation from theFinancial Services Compensation Scheme (FSCS), up to the prescribed limits, in the event that there is a shortfall in either your assets or your client money resulting from such action
Certainly! The article you shared covers aspects of financial security in the event of insolvency, particularly focusing on how customers' money and investments are safeguarded. Let's break down the concepts mentioned in the article:
-
Insolvency: This term refers to a situation where a company or entity is unable to meet its financial obligations and is unable to pay debts owed. In this scenario, the article addresses the protocols in place to protect customers' funds and investments.
-
Separation of Funds: The article emphasizes that customers' money and the company's own funds are kept separate. This segregation helps ensure that customers' investments and cash are not affected if the company faces insolvency.
-
Nominee Accounts: Funds owned by customers are held in nominee accounts. These accounts are registered under the customers' names but are managed by the company, keeping track of individual assets belonging to each customer.
-
FCA Rules: The Financial Conduct Authority (FCA) establishes and regulates guidelines for financial firms. The mentioned rules ensure compliance with regulations concerning the handling of client money and assets, especially in the event of insolvency.
-
Trust Accounts: Cash held by customers is placed in trust accounts at authorized banks, providing an additional layer of protection in accordance with FCA rules.
-
Insolvency Practitioner: In the event of insolvency, an insolvency practitioner is appointed to manage the situation. Their role involves identifying and safeguarding assets belonging to customers and ensuring these assets are protected and returned or transferred to another provider as required.
-
Administration Costs: In some cases of insolvency, the appointed insolvency practitioner may use a portion of assets or client money to cover administration expenses associated with returning or transferring customers' investments.
-
Financial Services Compensation Scheme (FSCS): This scheme provides protection to customers in the event of financial firms' failure. It may offer compensation, up to prescribed limits, if there's a shortfall in either assets or client money due to actions taken during insolvency.
The article primarily focuses on reassuring customers that their investments and money are protected through various mechanisms and regulations, even in the unfortunate scenario of insolvency. It aims to instill confidence by outlining the steps taken to safeguard customers' interests and the available compensation schemes in case of any potential shortfall.
