FCA Investigating Financial Advisors

[bitchstewie]

Totally get that it's bad apples but I'm surprised some of the alleged activities are even possible with the way I thought client money had to be ring-fenced

How many more bad apples are in the adviser barrel?

[Phooey]

I think it’s only ring fenced in the sense of if the company goes tits up, but not insider fraud. That’s pretty shocking. So if they really wanted too, basically senior managers can withdraw clients funds!

Edited by Phooey on Friday 17th February 22:12

[Rufus Stone]

bhstewie said:

Totally get that it's bad apples but I'm surprised some of the alleged activities are even possible with the way I thought client money had to be ring-fenced

How many more bad apples are in the adviser barrel?

Ringfencing does not prohibit theft by the people who have access to the funds though.

The PI insurers or FSCS will likely compensate investors I would have thought.

[bitchstewie]

Rufus Stone said:

Ringfencing does not prohibit theft by the people who have access to the funds though.

The PI insurers or FSCS will likely compensate investors I would have thought.

Poor terminology on my part in that I assumed you couldn't simply transfer from a client funds account to any old account (like to your own personal account going off the allegations).

[steve_n]

The skimming was done by calling the deductions 'Advice Charges' and that's a normal thing to take from client accounts into company accounts. From there into their pocket.

There's less danger of this happening in a big firm because there's more internal governance and one or two people aren't doing everything themselves.