Cairns Financial Services, Merchant’s nominated adviser, said there were no more details to reveal at this time.
Earlier this month (9 March 2012), Merchant House structured products subsidiary Merchant Capital revealed it had pulled 98 per cent of client funds out of Pritchard Stockbrokers shortly before the broker’s collapse.
Merchant Capital added that, at the time, two per cent of client monies - about £6m - remained frozen at Pritchard. This included money from matured policies which has not yet been claimed and money paid by clients to Pritchard which had not yet been invested, the company added.
The collapse of the broker followed a supervisory notice that was issued by the FSA which prohibited Pritchard from carrying on any of the regulated activities except to close transactions that had already commenced.
The notice concerned alleged breaches in relation to client asset handling at the firm, including use of client funds in its own accounts.