FCA Says Alexander David Securities Has Appointed Joint Liquidators

The Financial Conduct Authority (FCA Financial Conduct Authority (FCA) The Financial Conduct Authority (FCA) is the largest financial regulator for all financial markets in the United Kingdom (UK).The UK regulator is responsible for the conduct of firms authorized under the Financial Services and Markets Act 2000. Moreover, the FCA is also responsible for the regulation of behavior in retail and wholesale financial markets, supervision of the trading infrastructure that supports those markets, and the prudential regulation of firms not regulated by the PRA. Its rol The Financial Conduct Authority (FCA) is the largest financial regulator for all financial markets in the United Kingdom (UK).The UK regulator is responsible for the conduct of firms authorized under the Financial Services and Markets Act 2000. Moreover, the FCA is also responsible for the regulation of behavior in retail and wholesale financial markets, supervision of the trading infrastructure that supports those markets, and the prudential regulation of firms not regulated by the PRA. Its rol Read this Term) announced on Monday that Alexander David Securities Limited (ADSL), a London-based provider of corporate finance advisory services, entered creditors’ voluntary liquidation on July 1.

The United Kingdom’s financial industry watchdog also disclosed that Shane Cooks, Emma Sayers and Malcolm Cohen of BDO LLP, a UK advisory services firm, were appointed as joint liquidators.

The FCA explained that the joint liquidators were selected to wind up ADSL for the benefit of its creditors.

However, it noted that ADSL still remains under its authority and is subject to its oversight and rules.

“The joint liquidators need to comply with all insolvency law and are licensed insolvency practitioners licensed by the Institute of Chartered Accountants in England & Wales (ICAEW). We are liaising closely with the joint liquidators,” the FCA explained.

The market supervisor noted that ADSL, which offered services such as initial public offerings, secondary fundraisings, mergers and acquisitions and debt offerings, was placed into liquidation because of its failure to repay its debts.

The FCA disclosed that the advisory services firm had permission to hold and control client money Client Money Client money refers to the money or margin – which may be any currency in the form of cash, check, draft, or electronic transfer – that a firm receives or holds for a client. Money held by a firm in the form of a stakeholder, which is are not payable on demand or immediately due, also refers to client money. The definition of client money does not apply to money held by businesses that operate in its own name on behalf of a client. Although the client does have to be in agreement before this arr Client money refers to the money or margin – which may be any currency in the form of cash, check, draft, or electronic transfer – that a firm receives or holds for a client. Money held by a firm in the form of a stakeholder, which is are not payable on demand or immediately due, also refers to client money. The definition of client money does not apply to money held by businesses that operate in its own name on behalf of a client. Although the client does have to be in agreement before this arr Read this Term under the FCA Client Money Rules until June 29, 2020.

It added that ADSL agreed voluntarily to stop doing so after that date.

The market supervisor noted that following the application of voluntary requirements on June 29, 2020 and a subsequent regulatory action on April 20, 2022, it imposed a number of requirements on the advisory services firm.

One of these requirements is that ADSL must not dispose of, withdraw, transfer, deal with, or diminish the value of any of its assets without the FCA’s consent.

The FCA explained, “Following the issuing of the First Supervisory Notice to the firm on 29 April 2022, we remained concerned that the firm was not able to meet its debts as they fell due.

“The director and shareholder of ADSL subsequently undertook to place the firm into creditors’ voluntary liquidation and appointed the joint liquidators.”

One of the reasons for this action, according to the FCA, is because ADSL “is failing or is likely to fail.”

In addition, the regulatory body said it “identified serious concerns relating to ADSL in that its conduct appears to demonstrate that it poses a significant risk of harm to consumers.”

The FCA said it would be writing to all known creditors of ADSL shortly to explain what the development means, and how they can make a claim.

Client’s Claim for Refund

Furthermore, the UK watchdog noted that the joint liquidators will assess whether Alexander David Securities Limited has been holding client’s money beyond the permitted date.

However, the body believes that the firm may have continued to hold and control some client money after that time.

“Following that assessment, the joint liquidators will work to return money to clients in accordance with applicable law,” it added.

The FCA noted that the costs associated with distributing money back to clients, including the liquidator’s fees, will be deducted from that client’s money.

Although, it noted that those found eligible for compensation by the UK Financial Services Compensation Scheme (FSCS) will enjoy cost coverage for the shortfall.

It explained, “The FSCS has eligibility criteria both in respect of the people and businesses who are covered.

“For eligible clients, the FSCS will cover client money shortfalls, including the costs associated with distributing money back to clients, and any other eligible claims against the firm, up to a total of £85,000.

“The joint liquidators will work with the FSCS to determine the position and will provide further updates.”