City Equities Ltd and/or Beaufort Securities Ltd

tg99

Would investors with £50k or less not be fully protected by the FSCS compensation scheme? Thus leaving the haircut resulting from PWC fees to come from balances over £50k?

Also surprised this has not had more coverage especially as most people view their investment savings over £50k as safe (unless there is fraudulent behaviour) when held with nominee companies at the various U.K. retail platforms / brokers.

masonic

tg99 wrote: »

Would investors with £50k or less not be fully protected by the FSCS compensation scheme? Thus leaving the haircut resulting from PWC fees to come from balances over £50k?

Not in the case of a non-advisory service. For execution only, I believe there is FSCS protection for your underlying investments (where applicable) but not in respect of the platform itself.

Graham_R_Middleton

I have lost over 60% of my investment with Beaufort Securities. I always found them to be very good as Hoodless Brennan/HB Markets. However when they became Beaufort they moved to an online portal which I could not access despite various requests to them. I fail to see how they could lose so much of my investment (which were all in the FTSE 100 and 200) during a period when the FTSE 100 has been performing well. I have even found out that I still hold shares in UMC Energy which was de-listed some years ago.

dunstonh

I have lost over 60% of my investment with Beaufort Securities.

Niche, high risk specialist investments are not classed as high risk for no reason. When a loss event occurs, that you knew was potentially possible it should not surprise you.

There are consequences to your actions when you use non-mainstream options and take high risks. You may get higher upside but you may get greater downside.

However, I do wonder why you think you have lost 60% of your value if it was only using big companies. Either you are using those investments and not lost the money or you were using the high risk illiquid specialist investments where the money is going to be lost.

Reaper

dunstonh wrote: »

Niche, high risk specialist investments are not classed as high risk for no reason. When a loss event occurs, that you knew was potentially possible it should not surprise you.

There are consequences to your actions when you use non-mainstream options and take high risks. You may get higher upside but you may get greater downside.

However, I do wonder why you think you have lost 60% of your value if it was only using big companies. Either you are using those investments and not lost the money or you were using the high risk illiquid specialist investments where the money is going to be lost.

I don't think this is correct. It is entirely possible they only invested in low risk trackers and their funds were ring fenced. Despite this the liquidators (PwC) have been digging deeply into the supposedly ring fenced funds to pay costs and their own fees.

Of the £850m assets at the time the broker failed these have now shrunk to £500m. I am not sure where the figure of 60% comes from but some of their bigger clients do face losses of 40% which I have to say is pretty appalling for ring fenced funds.

More info here:
http://citywire.co.uk/money/david-kempton-my-outrage-at-beaufort-fallout/a1122602

Aegis

Reaper wrote: »

I don't think this is correct. It is entirely possible they only invested in low risk trackers and their funds were ring fenced. Despite this the liquidators (PwC) have been digging deeply into the supposedly ring fenced funds to pay costs and their own fees.

Of the £850m assets at the time the broker failed these have now shrunk to £500m. I am not sure where the figure of 60% comes from but some of their bigger clients do face losses of 40% which I have to say is pretty appalling for ring fenced funds.

More info here:
http://citywire.co.uk/money/david-kempton-my-outrage-at-beaufort-fallout/a1122602

There have been significant updates since the date of the article you linked there. In particular, clients with standard traded assets will have their loss capped at £10,000, which falls well within the FSCS limit. As such, most standard retail clients will lose nothing but time.


https://www.pwc.co.uk/services/business-recovery/administrations/beaufort/latest-news-and-update/general-update-bsl-and-bacsl-29-june.html


Probably the most important quote from the page:

For clients covered by the FSCS there will be no effect on client asset holdings. The administrators' primary objective is to transfer clients to a nominated broker, subject to certain conditions being met.

Those with unregulated or unlisted / illiquid assets may well have apparently lost a load of value overnight because Beaufort never revalued the holdings to account for market conditions. If those have resulted in significant loss of value, this has nothing to do with PWC or the failure of Beaufort, but rather an attempt to actually price some of those holdings rather than just reporting the book cost.



I don't have any clients with Beaufort, incidentally, but some of them have been worried about how the FSCS and PWC were handling a failed platform, so I've needed to look into the collapse and administration process on their behalf.

Malthusian

Reaper wrote: »

It is entirely possible they only invested in low risk trackers and their funds were ring fenced.

Not if they lost 60%.

eskbanker

Graham_R_Middleton wrote: »

I fail to see how they could lose so much of my investment (which were all in the FTSE 100 and 200) during a period when the FTSE 100 has been performing well.

What exactly were you invested in and in what proportions? Obviously it's entirely plausible (and indeed expected) that even though an index does well, there will be constituent elements that will be below the average, some significantly so, i.e. if you'd had, say, a disproportionately large holding of Carillion then you'd be unlikely to match the overall index performance....

In other words, if you want to track the performance of an index you'd invest in, er, an index tracker, rather than buying some or all of its constituent shares.

And when you say you lost over 60%, have you been formally informed that you will definitely lose this, or does FSCS not mitigate these losses?

Glen_Clark

Reaper wrote: »

No, I don't believe there is any connection between the two. X-O are owned by Jarvis Investment Management.

Correct, X-O are owned by Jarvis Securities plc https://markets.ft.com/data/equities/tearsheet/summary?s=JIM:LSE - who also provide stockbroking and custody services to Building Societies, Pension Funds and other Brokers.
So I suppose others could use their services and slip their name into their sales pitch to gain respectability?
I can't think how else X-O name has got into this?

Reaper

Glen_Clark wrote: »

I can't think how else X-O name has got into this?

The only reference I have seen to X-O is on this thread. Originally Frogg said about Beaufort:

frogg wrote: »

Well I've used them for XO for about 8 years

I don't know what he meant by XO but I don't think it was a reference to X-O the company ("exchange orders" or something perhaps? EDIT: "Execution only" - see below).

Other posters then started talking about X-O as if they were involved.

Unless anyone has any further info I think we can say they are unrelated.