A wealth manager that went into administration following intervention from the regulator has been contacted by more than 100 firms interested in its clients.
SVS Securities PLC entered special administration in August after the Financial Conduct Authority identified "serious concerns" about the way in which the business was operating.
The regulator found it was targeting IFAs to promote its model portfolios to clients after a defined benefit pension transfer or Sipp switch and said the proportion of illiquid and high-risk bonds in its model portfolios were unlikely to match these clients' needs.
In some cases clients of the wealth manager were paying fees and charges as high as 20 per cent of their total investment, the FCA claimed.
"Urgent" supervisory work by the financial regulator followed a tip-off about the assets in which SVS was investing client money, with the watchdog consequently instructing the wealth manager to cease all regulated activities.
Julien Irving, Andrew Poxon and Alex Cadwallader of Leonard Curtis Business Rescue and Recovery were appointed as special administrators of SVS and in an update published today (September 13) they confirmed "positive progress" was being made in the case.
Mr Irving said the administrators had received "significant interest" from more than 100 regulated firms enquiring about a transfer of SVS business and client money to their own companies.
He also confirmed the administrators had secured clients' money and custody assets but said whether or not SVS's business was transferred to other firms would determine how these would be returned to clients.
The administrators are currently working with the Financial Services Compensation Scheme to determine potential losses.
Mr Irving added: "Please note that the joint special administrators will continue to liaise with the FSCS to compensate eligible clients directly if required. A more detailed client update on progress has been posted on [our website]."
In the FCA’s first supervisory notice published on its website in August the regulator said it was concerned some customers of SVS had been charged a series of high fees and commissions, in some cases amounting to as much as 20 per cent of the total investment.
According to the City-watchdog the high fees were partially the result of conflicts of interest at the company, with the FCA’s supervision team finding emails sent between 2016 and August this year showing SVS worked closely with third parties to help "generate and sustain" demand for the investment products it offered.
In particular the third parties included professional advisers, bond issuers and product providers and the investment products SVS aimed to push included its DFM model portfolios, the FCA found.
The regulator said SVS did so "without apparent regard" for the investment needs of customers, resulting in high fees and charges which it warned had “negatively impacted” clients.
Leonard Curtis said further details of their work would be contained in the administrator's proposals which will be available by September 25, 2019.