Adviser DFM parent agrees to cease new business

Adviser DFM parent agrees to cease new business

The parent company of a provider of outsourced investment management services to financial advisers has agreed with the regulator to stop carrying on regulated activities and cease new business, after it was forced to suspend trading and seek to appoint adminstrators.

According to notices published on the website of Hume Capital Securities and the Financial Conduct Authority, the firm will not continue to undertake regulated activities unless settling existing contracts and will not take on new clients or execute new trades for existing clients.

The notice issued by Hume states the firm requested the suspension of trading in its shares on Wednesday (11 March) and that membership of the London Stock Exchange was subsequently suspended yesterday.

Article continues after advert

It adds that due to financial difficulties it had appointed insolvency practitioners Leonard Curtis and legal advisors DWF to “explore options for the continuation of the business”, but that it believes the “only option open” is to appoint administrators.

As the company falls under the Special Administration Regulations 2011, it will apply to the court to appoint administrators under the regime, which is “expected to take place within the next few days”.

Hume is an asset management and capital markets company listed on the Alternative Investment Market. Its subsidiary, Hume Capital Management, is an FCA-authorised provider of pooled investment services for financial advisers and hedge funds.

Within the adviser section of its website, the firm promotes a range of options to “help meet clients’ financial planning needs” including both open-ended Ucits funds in the global bond and equity sectors, as well as a Guernsey-based offshore Oeic offering a choice of cash, bond, equity and multi-asset funds.

The FCA said in its statement: “HCS is in financial difficulties and has agreed to restrict its regulated activities... to ensure that its clients and creditors are appropriately protected.”

Hume added that it “continues to oversee the custody of client assets” in accordance with the Client Assets Sourcebook requirements and will “act in accordance with the FCA’s expectation to ensure appropriate protection and fair treatment of customers”.