WealthTek LLP

Latest updates

• 14 Nov, 2024

  As outlined in our previous update, if you’re an eligible client, FSCS will pay your share of the Special Administration costs. In addition to the Special Administration costs compensation, eligible clients are also entitled to compensation for any shortfalls identified in their client assets or client money. Your share of the costs and any shortfall will be added up and paid to the Joint Special Administrators (JSAs), up to the overall FSCS compensation limit of £85,000.

  FSCS has now paid a sum of just over £26.6m to the JSAs, which represents the first portion of costs and shortfall compensation.  This compensation has been paid for those clients who have opted in for FSCS compensation, and where we have confirmed their eligibility with the JSAs. For these clients, the Client Asset Confirmation Statement they have received will indicate that they are eligible for FSCS compensation.  
  
  This payment to the JSAs will allow onward payment to customers through either a transfer to a nominated broker or directly as outlined in the latest JSA update. It is important to read this update thoroughly, and certain clients will need to opt in for their direct payment.

  We continue to work closely with the JSAs to determine whether claimants who do not hold their account in individual or joint names (mostly deceased estates and trusts) can claim through FSCS. Customers in that category should continue to engage with the JSAs and provide any information requested regarding their situation as soon as possible.

  FSCS understands that a further hearing will be held on 14 November 2024 to clarify some outstanding issues on the costs reserve following the most recent judgment.  FSCS will continue to work with the JSAs following the hearing.

  Please be wary of scams. FSCS will never ask you for money to make a claim or receive compensation, as our service is free. If you are concerned about any contact you receive, please contact us directly using the details found on our website's Contact us page.
  
  Edited 11:30am 14/11/24

• 31 Jul, 2024

  The High Court approved the Distribution Plan for WealthTek LLP on 23 July 2024.

  The Joint Special Administrators (JSAs) from BDO LLP are in the process of providing further information to clients about the return of client assets.

  You can find further details on the JSAs’ website, which include a copy of the sealed order approving the distribution plan, documents relating to the court application and a copy of the Distribution Plan.

  Transfer of assets 

  On 19 July the JSAs announced the appointment of GHC Capital Markets Limited as Nominated Broker. 

  Clients who are eligible under FSCS rules and who have indicated they wish to receive FSCS compensation will be able to transfer to the Nominated Broker without any associated deduction from their assets. We will pay your share of the Special Administration costs to the JSAs. This will happen automatically - you don’t need to apply to FSCS for compensation directly.  

  Whilst a transfer of client assets to the Nominated Broker is the default position under the Distribution Plan, clients can opt-out of this and choose one of the alternative options outlined in the Distribution Plan. This will not affect clients’ eligibility for FSCS compensation.

  FSCS eligible clients are also entitled to compensation for the client asset and client money shortfalls identified by the JSAs. Your share of the costs and any shortfall will be added up and paid up to the overall FSCS compensation limit of £85,000. All clients who are individuals are likely to be FSCS eligible. We continue to work closely with the JSAs to determine whether each non-individual customer can claim through FSCS. 

  Please be wary of scams. FSCS will never ask you for money to make a claim or receive compensation, as our service is free. If you are concerned about any contact you receive, please contact BDO LLP on WealthTekclients@bdo.co.uk or 0151 351 4700.

• 13 Jun, 2024

  FSCS is aware that the JSA’s application seeking approval of the Distribution Plan on Friday 7 June was adjourned by the judge.

  We are anticipating that the JSAs will return to court with further details of their plan as soon as they realistically can.

  We still expect that we will be providing compensation to FSCS eligible customers in respect of Special Administration costs and shortfalls. This compensation is subject to a Distribution Plan being approved by the court and is capped at £85,000 per eligible customer.

• 14 May, 2024

  The Joint Administrators have recently filed their application to Court for the approval of the Distribution Plan for WealthTek LLP which is due to be heard on 7^th June 2024.

  Further details as to how clients are expected to receive returns of their assets will be provided in the Distribution Plan and accompanying Explanatory Statement which can be found on the JSA’s website.

  FSCS compensation will only be available once the Distribution Plan is approved by the Court. If you are an eligible claimant (and have indicated that you wish to receive FSCS compensation on your Client Assets Claim Form provided by the JSAs) FSCS will pay your share of the Special Administration costs.

  Additionally, FSCS protected claimants are entitled to compensation for the shortfalls identified. Your share of the costs and any shortfall will be added up and paid up to the overall FSCS compensation limit of £85,000.

  Once JSA costs have been met, any remaining compensation you are owed will be transferred, together with any Client Assets or Client Money, to your new broker.

• 12 Feb, 2024

  The Joint Special Administrators (JSAs) will be contacting customers of WealthTek LLP this week to provide them with their Client Assets Statements and inviting them to submit their claims to Client Assets and Client Money Entitlements.

  If you were a customer of WealthTek, you will be provided with a Client Assets Statement which will contain information regarding your Client Assets claim, Client Money Entitlement and any shortfall the JSAs have identified through their reconciliation of the client assets and money.

  FSCS won’t be able to confirm any details outlined on the statements provided by the JSAs. However, you can request contact from the JSAs team to discuss any queries using the online Client Assets Claim Form or alternatively they can be contacted at WealthTekclients@bdo.co.uk or on 0151 351 4700.

  This is the next stage in returning property to customers. The JSAs are also preparing a distribution plan in order to facilitate the return of Client Assets.  It is hoped that once the distribution plan has been agreed by the Clients’ and Creditors’ Committee, and then approved by the Court, then customers’ holdings can be transferred to a new broker.

  FSCS plans to meet the costs of this transfer, and shortfalls in client monies and assets, on behalf of each eligible customer. This is subject to our normal compensation limit of £85,000 per person. 

  We intend to pay the JSAs directly to cover the transfer costs and any shortfalls. However, if a customer states that they do not want FSCS compensation when confirming their claim to Client Assets and Client Money Entitlements, the JSAs will not be able to transfer the customer’s property to a new broker without the customer paying the costs of doing so. Accepting FSCS compensation is subject to our terms and conditions.

• 03 Nov, 2023

  On 14 September 2023 we released an update that we anticipated that we are likely to protect eligible customers. We have now taken the next step by declaring WealthTek LLP ‘in default’.

  Note that we still remain closed to claims. However, this is an important step which needs to be made before we can process FSCS protection for WealthTek clients. There is still a considerable amount of work to do before customers can be reunited with money and assets and the issue of shortfalls addressed.

  We're continuing to work closely with the Joint Special Administrators and will provide further updates, including timescales, when that information is available.

   

• 14 Sep, 2023

  We have been continuing to work closely with the Joint Special Administrators about whether there are any claims that are eligible for FSCS compensation.

  We now anticipate that, for customers who are eligible under FSCS rules, we are likely to meet any losses suffered in relation to the following;

  • the costs of returning client money to the customer and;
  • the costs of transferring any assets to a new broker - provided the particular assets are covered by FSCS's rules.
  • client money shortfalls, that have occurred as a result of WealthTek not holding all the client money that it had undertaken to hold for that customer; and
  • client asset shortfalls that have occurred as a result of WealthTek not holding the client assets it had undertaken to hold for that customer.

  Further information regarding eligibility for FSCS compensation can be found here:

  https://www.fscs.org.uk/making-a-claim/claims-process/eligibility-rules/

  Any compensation payable by FSCS is subject to the statutory cap of £85,000 per eligible customer, per firm.

  Prior to any compensation payment, the Joint Special Administrators’ Distribution Plan needs to be approved by the Clients' and Creditors' Committee and the Court. This plan sets out how customer’s property will be returned to them. 

  We don’t yet have a timescale for how long it is likely to take to return money and assets to customers. The Joint Special Administrators will be providing more updates as their work progresses. We will continue to work closely with them and will provide further updates ourselves, including on timescales, when that information is available.

  At the moment, WealthTek customers do not need to take any action regarding FSCS compensation. We remain closed to customer claims.

• 31 Jul, 2023

  We expect that there will be some claims that meet the qualifying conditions for compensation. Investigations are continuing to determine the exact extent of what can be covered. 

  FSCS will not be opening to customer claims right now. We are liaising with the administrators on a regular basis. As more information regarding WealthTek becomes available through their ongoing work, FSCS will continue to review the situation.

• 31 May, 2023

  We are aware that the Joint Special Administrators published their proposals for WealthTek’s insolvency on 30 May 2023. You can find these on the BDO website.

  In the proposals, the Joint Special Administrators have described how they expect a shortfall of up to £81.4m in the client money and assets held at WealthTek.

  The FCA has also published an update on its actions regarding the firm.

  FSCS is working closely with the Joint Special Administrators to establish whether FSCS compensation will be available for customers. We remain closed to customer claims currently.

  We’ll provide further updates on this page as soon as we can.