Beaufort securities in administration

Les8352

I have a number of shares in an ISA with Beaufort Securities which has just been put into administration. Does anyone know what is likely to happen to my shares? Will I get them back?

Alexland

See below thread on this topic

https://forums.moneysavingexpert.com/discussion/5808277

xylophone

https://www.which.co.uk/news/2018/03/beaufort-securities-goes-bust-what-are-your-rights/

dunstonh

The risk of using non-mainstream high-risk investments is that they are more likely to fail. This style of investment should never form more than 5% of your portfolio. So, hopefully, your exposure is limited.

steampowered

If a company has gone into administration, that means it is not able to pay its debts.

It is unfortunately very unlikely that shareholders will receive anything from the administration. Creditors get paid before shareholders.

You should expect to lose your entire investment, unfortunately.

redux

steampowered wrote: »

If a company has gone into administration, that means it is not able to pay its debts.

It is unfortunately very unlikely that shareholders will receive anything from the administration. Creditors get paid before shareholders.

You should expect to lose your entire investment, unfortunately.

Specific information can be better than generalised comment.

The thread linked in post 2 includes links to or mention of BBC and FT articles which include more informed comments by PwC, the administrators appointed to deal with this.

They say they have identified £850M in cash and funds, more than they initially expected, and suggest that people will get substantial amounts back, though not quite all, and it may take a while.

http://www.bbc.co.uk/news/business-43301342

Malthusian

steampowered wrote: »

You should expect to lose your entire investment, unfortunately.

The OP said their shares were with Beaufort Securities, not in Beaufort Securities. Unless the problems at BS are even worse than feared, the OP's shares should still be there and they will get them back eventually. No need to scare them like that.

lozzy1965

So just to clarify - and excuse me being slow! - if you invest WITH a company (ie they hold YOUR funds/shares in a nominee account) the investment is YOURS still - not the companies, and is protected if the worst should happen?


This is what I understood to be the case - having substantial amounts in a Dealing Account, an ISA and a SIPP. This is my retirement funding - so I hope it is safe!


(I'm with another broker - but it could happen to any firm).

Alexland

lozzy1965 wrote: »

So just to clarify - and excuse me being slow! - if you invest WITH a company (ie they hold YOUR funds/shares in a nominee account) the investment is YOURS still - not the companies, and is protected if the worst should happen?


This is what I understood to be the case - having substantial amounts in a Dealing Account, an ISA and a SIPP. This is my retirement funding - so I hope it is safe!


(I'm with another broker - but it could happen to any firm).

It really does depend on what you have invested in and if fraud occurs then you could be falling back on the £50k FSCS investment services protection if it applies. We split our investments across multiple platforms and fund managers to limit the loss if the worst was to happen. It costs a bit more in fees but it is worth it for the peace of mind.

Alex

JohnRo

A nominee account held with a broker means you've nominated the broker to act as your agent in the marketplace. That means securities are in your name but held by the broker for trading purposes.

The only problem with this arrangement is if the broker is being dishonest and committing fraud. A situation where the account you're being presented is a fiction and doesn't tally with the reality of what they're doing with your money and everyone else's.

If they're regulated they should have arrangements that ringfence accounts belonging to the business from those belonging to their clients.

Col_Jessop

Duplicate post on another Beaufort related thread:

In a slightly different position from the originating poster. I just had an online sharedealing account with Beaufort. I actually contacted the FCA, FO and FSCS last year when the FCA put out a notice about them. All reassured me that my money was safe and that Beaufort were regulated. Beaufort lied that the issue was down to them revamping their IT system. It was enough reassurance from the protective bodies for me to leave the account live.
Email through from PWC telling us about the insolvency enacted by the FCA. They gave a PWC helpline. It is actually answered by the pathological liars at Beaufort Securities. And they lied. It took quite a bit of effort to speak with PWC directly.
It looks like there is still a reasonable chance that Beaufort do not hold enough shares to match the shares held in customer accounts. So it might not be quite as simple as them transferring the share to another broker. PWC will also be taking a share of whatever is salvagable. So even if all your shares are covered there will be a loss interms of PWCs costs for managing the insolvency.
The Financial Ombudsman is powerless as Beaufort are insolvent and no longer regulated. Basically they can;t fine an insolvent company so won't take any new complaints.
The FSCS still have no process in place and no information to provide to Beaufort / FCA's victims. I have conflicting information that the FSCS will notify the victims once they have information from the FCA / PWC; and that it is up to the victims to complete a claim form - the form is irrelevant to the current situation.
The FCA are demonstrating their typical contempt towards the victims of Beaufort. No information in relation to what people should do other than call a helpline that has Beaufort staff pouring more lies onto an already flaming bonfire of customers cash.
Basically, this looks like a rudderless shambles with the victims being offered no support / information until the FCA has covered its own backside. Why did the FCA have to be forced into action by a foreign country when the majority of Beaufort's customers are UK citizens? Why if they palnned to make Beaufort insolvent did they not have a process in place that would provide reassurance to the victims?
I really feel for the victims who are potentially far more exposed financially than me by this. I am reading stories of hundreds and potentially thousands of people losing significant and perhaps all of their retirement funds. The FCA and FSCS really need to get their act together on this and start provide clear and consistent advice to the victims.
I wouldn't bother raising compliants by telephone or wasting your time with the Beaufort helpline. best to raise you complaint by email / letter to the FCA / PWC / FSCS at the highest level. If you need email alises for c-level staff at these orgs drop me a PM and I will provide.