Brewin Dolphin has responded to its inclusion in a list of adviser firms that could be sued over Keydata investment recommendations by saying that it sees “no merit” in the claim being brought by the Financial Services Compensation Scheme.
Herbert Smith, the law firm acting for the FSCS to pursue a claim against advisers that recommended Keydata, issued a claim in the Royal Courts of Justice last week.
FTAdviser has seen a document entitled Particulars of Claim, dated 23 November, which mentions a “schedule” of advisory firms that are to be pursued. FTAdviser has also seen a list that includes the names and addresses of more than 450 firms that advised on Keydata, but it remains unclear whether this is the official schedule in the case.
FTAdviser has not disclosed the names of the firms as the list may only be a preliminary document. However, Brewin Dolphin has confirmed that it was named on the list and has responded to the letter, saying that it “sees no merit to this claim”.
The firm added that it was sent documents that relate to clients with Keydata-related investments totalling £106,000, but that it understands that these clients had “already been compensated in full”.
Several of the firms that have been named on the list have raised concern that their names have been published by several third party websites. Some have said that they did not sell Keydata products, while others have said that they are on the list due to advisers that joined the firm having sold the products while with a previous employer.
The Particulars of Claim seen by FTAdviser allege negligent advice, breach of duty of care, mis-statements in that firms made “false statements to raise the profile and suitability of the products” and breach of statutory duty under Section 150 of the Financial Services and Markets Act 2000.
A spokesperson for Brewin Dolphin told FTAdviser: “The papers received yesterday (24 November) relate to a very few clients for investments totalling approximately £106,000. Our understanding is that all of these clients have already been compensated in full.
“Brewin Dolphin can see no merit to this claim - having already contributed to the industry fund used to compensate investors - and will defend it vigorously.”
The Royal Courts of Justice told FTAdviser that court papers could not be released until defendants have responded. It also refused to acknowledge receipt of any claim.
A spokesperson for the FSCS told FTAdviser last week: “We have served those firms with FSCS’s claim form and the particulars of claim, which sets out the details of FSCS’s potential claim, and requested a stay to allow the FSCS to engage directly with the firms in respect of its claim. We cannot comment further at this stage.”
