Britain’s Financial Services Compensation Scheme (FSCS) is accepting further claims against failed broker SVS Securities, which was dissolved in August 2019.
An update published by administrators Leonard Curtis confirmed that the lifeboat scheme opened its online claims service for SVS clients who wish to make further claims other than for the return of assets and money. The FSCS anticipates that any claims made will relate to failings in the SVS operator’s due diligence.
Although FSCS is accepting the ‘new claims’, these will not be immediately passed to its claims processing teams for assessment. They will first be tested for eligibility as the scheme cannot compensate clients solely for poor investment performance, or losses incurred as a result of not being able to access their assets during the special administration.
FSCS has already enabled the vast majority of SVS Securities’ clients to access their money and assets, which have been beyond reach for almost a year. Over 18,000 clients had their holdings returned through the nominated broker, ITI Capital.
The administrator said in March that other than a very small number of exceptions, the SVS clients are expected to get a ‘full return’ of their cash investment.
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The recent development comes as former clients of SVS Securities remain locked out of their assets. This is nearly one month after they were told that they would be able to access their funds. At least 20 clients have told Finance Magnates they were unable to access ITI Capital’s onboarding system. Other traders reported that they have yet to receive their initial onboarding email, i.e., they didn’t set up their accounts days after FSCS opened the gates.
Warning of Recovery Scam
The legal update also told clients to proceed with caution if approached by firms offering assistance to return their assets with regards to SVS Securities. It declared that for the vast majority of clients there would be no benefit in involving a third party to reclaim assets.
The liquidators have specifically stated that some of SVS clients, whose funds were transferred to ITI Capital, were recommended to take on management services offered by SJS Legal Limited.
“Clients should be aware that there is no affiliation, connection or other link between the Company and SJS Legal. Furthermore, clients should proceed with caution if they are approached by SJS Legal or any other Claims Management Company (a ‘CMC’). For the vast majority of clients, there is no benefit in involving a third party or CMC in submitting a claim to the FSCS as this may result in additional costs for clients,” it further explains.
Previously, the administrators of SVS Securities warned clients of the UK failed broker about people claiming that they can help them refund their investments. Liquidators from Leonard Curtis said investors should not be lulled into false communications from individuals trying to usurp its identity to defraud them in a recovery scam, in which clients are asked to pay a fee upfront before they receive any proceeds.