Beaufort securities in administration

Murphy_The_Cat

Col_Jessop wrote: »

. If you need email alises for c-level staff at these orgs drop me a PM and I will provide.

What are c-level staff ?

eskbanker

Murphy_The_Cat wrote: »

What are c-level staff ?

It normally refers to Chief, as in CEO, CFO, COO, etc, although other less complimentary meanings may have been intended in the banking sector over the last ten years

max11

Alexland wrote: »

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

Sorry guys, just to understand...as there has probably been some confusion in this post...
(Apologies if this was discussed in other posts, but I have not found it!)

The FSCS protects "£50,000 per person per firm (Investments)"

Therefore, if we use one or more stokebrokers (H-L and Fidelity or Beaufiort like the OP for example) and we hold different funds from different companies (HSBC, L&G, Ishares,Vanguard for instance), as long as the total amount with each of the companies is under £50k, then we should be protected if one of them goes burst.
If a stokebroker goes burst, it should not really affect the customer (unless frauds) as the holdings are under his name.

Are both assumptions correct?

Thank you
Max

dunstonh

Therefore, if we use one or more stokebrokers (H-L and Fidelity or Beaufiort like the OP for example) and we hold different funds from different companies (HSBC, L&G, Ishares,Vanguard for instance), as long as the total amount with each of the companies is under £50k, then we should be protected if one of them goes burst.

Remember Beaufort is different to holding investments on platform. They were a discretionary investment manager using unregulated investments. They were holding client money. Hence why PWC can charge against it. Different to a platform.

However, yes, £50k per fund house per person and £50k per platform (irrespective of fund house) are the limits. However, that would be a level of paranoia that is really unnecessary.

Alexland

max11 wrote: »

If a stokebroker goes burst, it should not really affect the customer (unless frauds) as the holdings are under his name.

Many platforms now hold the shares in nominee accounts rather than directly registering them in the customer's name so it gets a bit complicated getting access to the assets if the company fails. If the company has been fradulant you may find the assets were never even purchased.

max11

Thank you.
Ha, I assumed Beauford was a fund manager company! so sadly going burst was a foreseeable event...

dunstonh wrote: »

However, yes, £50k per fund house per person and £50k per platform (irrespective of fund house) are the limits. However, that would be a level of paranoia that is really unnecessary.

sorry I did not get the part "£50k per platform (irrespective of fund house)"...

if I keep over £50k on each platform should still be covered as long as I am under £50k for each firm / fund house / fund manager?

For example, I use two platforms (>£50k on both) with different funds.
Every few months I check that the total amount invested with each fund manager (fund house) is under £50k (between the 2 platforms)

thank you

max11

Alexland wrote: »

Many platforms now hold the shares in nominee accounts rather than directly registering them in the customer's name so it gets a bit complicated getting access to the assets if the company fails. If the company has been fradulant you may find the assets were never even purchased.

thank you! hopefully it will not come to that with big platforms!
If I am right, you were suggesting somewhere else having more platforms to spread the risk...

Alexland

max11 wrote: »

If I am right, you were suggesting somewhere else having more platforms to spread the risk...

Yes that's an approach we take although we do not strictly limit the balances to the £50k limit as that would be impractical.

dunstonh

sorry I did not get the part "£50k per platform (irrespective of fund house)"...

if I keep over £50k on each platform should still be covered as long as I am under £50k for each firm / fund house / fund manager?

if the platform commits the fraud (say it never buys any of the investments it said), then you are only covered to £50k into total

Examples.
£50,000 on platform is covered if platform commits fraud.
£80,000 on platform is covered to £50k if platform commits fraud.
£100,000 on platform split equally between two fund houses but a fraud is found on one of the funds and the fund house fails. That would see £50k unaffected as its a different fund house. And protection would be upto £50k on the failed fund. Protection on the platform is never activated as the platform is not involved.

So, FSCS protection is multi-layered depending on where the issue is.

If a fund house fails, then the funds should not be affected as the investments within the fund are not impacted by the failure of the fund house (unless the fund is investing big chunks of the money into the fund house itself - e.g. Lindsell Train)
If the fund house was committing fraud but not within the actual funds then the funds are not affected.
If the fund house was committing fraud and using fund money then that is when a similar scenario to beaufort comes into play.
If the platform fails but the funds were purchased then you are unaffected (bar admin issues waiting for things to be resolved - most likely outcome is a buyer it sought)
If the platform fails due to fraud but the actual investments were bought correctly then you are unaffected
If the platform fails due to fraud and the investments were not bought, then you are covered to £50k

tg99

It not only the case of fraud where you could end up with a loss if the platform fails. If the platform fails but the funds WERE purchased and properly segregated/ring-fenced then you are still at risk of a haircut from administrator fees (albeit you would have to have a pretty large portfolio for this haircut to exceed £50k and thus suffer a loss over and above that covered by the FCSC scheme).