Work is continuing by the Financial Services Compensation Scheme and the special administrators of Hartmann Capital Limited, with the aim of making compensation payments as soon as possible.
The FSCS is working with the special administrators of the firm, which provides advisory and fund management services, to determine whether there is any compensation due in relation to client equities.
There is a compensation limit of £50,000 per person, and it is anticipated the FSCS will send out compensation to claimants for any shortfall within four weeks of recepit of the data from the sepcial administrators.
The move by the FSCS follows the Financial Conduct Authority issuing a ‘supervisory’ notice against the London-based firm, preventing it from carrying on regulated activities and restricting its ability to use and deal in client funds last December.
According to the notice, Hartmann disclosed to the regulator on 16 December that it was in financial difficulty and that it had a shortfall in its regulatory capital reserve of £1.2m.
The company had also admitted it has just £81,000 of ‘corporate capital’, an amount insufficient to meet “short-term expenses”.
In a release last Friday (27 June), the FSCS said: “The special administrators have or will return client equities to claimants (or their nominated brokers) once their claim to client equities has been agreed and relevant costs have been paid to the special administrators.”
The FSCS added: “FSCS is considering whether it is able to compensate claimants for certain of the costs charged by the special administrators.
“We will provide further details of any element of FSCS compensation which relates to the special administrators’ costs when we make our payments to eligible claimants.”