Compensation Underway for Pritchard Stockbrokers Ltd Clients
Following the appointment of Tim Ball, Roderick Weston and Alastair Wood of Mazars LLP as Special Administrators of Pritchard Stockbrokers Limited in March 2012, the Financial Services Compensation Scheme (FSCS) has been reviewing the firm’s business practices and data relating to the firm’s client base in preparation to process claims for compensation.
The Special Administrators have contacted clients of the firm to ask that they agree their account balances. The Mazars administrators need the approval of clients to these balances before they can include clients in a dividend or provide FSCS with details of the amounts owed to clients.
The FSCS will use these agreed balances to determine the compensation amounts people will receive, and is liaising with the Special Administrators to get this information as quickly as possible.
FSCS will shortly be sending out application forms to clients so that they can make a claim for compensation.
Pritchard Stockbrokers Ltd has entered the Special Administration Regime (SAR) on 9 March 2012.
Last February, the Financial Services Authority (FSA) in UK suspended the trading of Pritchard Stockbrokers after it allegedly used client money to meet its own expenses. The FSA issued a Supervisory Notice stopping Pritchard from carrying out its business.
In addition, the FSA froze Pritchard’s assets and the investor money and assets it holds. The FSA took this action because it had serious concerns about the way that Pritchard has been running its business and handling investor money. The FSA was concerned that the firm had failed to adequately protect the money that it holds on behalf of investors, and has allowed this money to be used to meet its own costs.