A plan for distributing the assets of failed broker SVS Securities was submitted to win court approval, opening the way for Payments to investors later this year.
An update published by administrators Leonard Curtis confirmed that the final terms of the Distribution Plan were approved by the creditors committee on April 21. The distribution plan will now be submitted to court for approval next month, scheduled for May 7.
The legal notice expects that clients would be able to access their fund starting from mid-July 2020, pending the court approval. The administrator said in March that other than a very small number of exceptions, the SVS clients are expected to get a ‘full return’ of their cash after they secured around £25 million of Client Money .
The distribution will be made through a nominated broker which has entered into a sale and purchase agreement with SVS. The identity of the nominated broker is expected to be disclosed at the end of May ahead of the date that the transfer will take place.
The administrators confirmed earlier that they received interest from more than 100 UK firms inquiring about a transfer of SVS business and client money to their own companies.
Deadline extended to May
Although a deadline for clients to submit their claims expired, the liquidators encouraged those who have not already filed claims to do so before May 11. They previously extended the original January 10 deadline to February 6, arguing the move would allow those who have not sought compensation to receive payments and view their holdings as the company records showed on August 5.
Once all clients’ claims have been verified and adjudicated, cash distributions will be made to clients on a pro-rata basis, meaning proportionately in terms of what is owed. Those who don’t submit their claims by the bar date could see their balances transferred to a regulated broker, though it is not guaranteed that late filings will be taken into account.
Leonard Curtis revealed that they are dealing with £277 million of custody assets and £24 million of client money across 21,000 accounts. Further, there are around 670 unsettled transactions, including certain bonds, the value of which remains uncertain.
Clients can visit the Leonard Curtis information website www.leonardcurtis.co.uk/svs/, where there is a link to the client claims portal, which can be accessed at https://LeonardCurtis.InsolvencyData.co.uk.
This is a positive step forward in the process of returning the available funds to clients who suffered losses as a result of the collapse SVS after the FCA identified “serious concerns” about how the company was operating its business.
Finally, the claims portal also allows clients to apply for FSCS compensation through a simplified process. The lifeboat announced earlier last year that those hit by financial losses are eligible for recompense through the FSCS, which covers investments up to the value of £85,000. But they warned there might be a “small number” of clients who may face shortfalls in their funds as above that level they would get nothing more.
