News for customers of Hume Capital Securities (HCS)

Published: 17/03/2015     Last Modified: 17/03/2015

On 16 March 2015 at 10:47AM the High Court appointed Julien Irving, Mark Colman and Andrew Duncan of Leonard Curtis Recovery Limited as joint special administrators.

On 12 March 2015, following discussion with the FCA, Hume Capital Securities (HCS) agreed to stop carrying on regulated activities (except in relation to settlement of existing contracts).

On 16 March 2015 at 10:47AM the High Court appointed Julien Irving, Mark Colman and Andrew Duncan of Leonard Curtis Recovery Limited as joint special administrators. This replaces the requirements imposed by the FCA on 12 March 2015 under section 55L(5) of the Financial Services and Markets Act 2000 (“the Act”).

The Special Administration Regime (SAR) introduced by the government in 2011 helps sort out situations where investment firms, which hold clients’ money and/or assets under the FCA’s Client Asset rules, fail. The SAR process has a number of objectives, but one of these is to ensure clients’ money and assets are returned to customers as soon as is reasonably practicable.

The subsidiaries of Hume Capital Securities PLC; Hume Capital (Guernsey) Limited, Hume Capital Investments Limited, Hume  Capital Management Limited, XCAP Nominees Limited and XCAP Securities (Middle East and India) Limited have not been placed into special administration.

FAQs

1. Who should I contact for more information?

Affected clients should contact the special administrators on hcs@leonardcurtis.co.uk

2. Why did Hume Capital Securities enter the SAR?

Having reached an assessment that it was no longer solvent, the firm made an application to Court to formally initiate insolvency proceedings under the SAR. 

3. If I cannot get the full value of my investments back, am I entitled to any compensation?

HCS is currently assessing its financial position - depending on your circumstances you may have access to the Financial Services Compensation Scheme, if you do not receive the full amount.

FCA Statement on requirements imposed on 12 March 2015

Following discussion with the FCA, Hume Capital Securities (HCS) has agreed to:

  • Stop carrying on regulated activities (except in relation to settlement of existing contracts)
  • Not take on new clients; or
  • Transact new business for new or existing clients

This is to ensure that client money and custody assets are protected and clients are treated equally. The FCA will work closely with the firm to ensure fair outcomes for consumers. Full details of the requirements are set out below.

HCS applied to the FCA to impose the requirements set out below under section 55L(5) of the Financial Services and Markets Act 2000 (“the Act”). These requirements applied from 8:00am on 12 March 2015.

Requirement 1

HCS must not, without the FCA’s express prior written consent:

(a) carry on business that involves the carrying on of a regulated activity, except where necessary to settle any existing contracts to which it is a party; and

(b) initiate any further business, including accepting a new client or a new order for an existing client.

Requirement 2

HCS must not deal with or release client money unless it is:

(a) receiving client money into its client bank accounts in compliance with CASS; or

(b) otherwise dealing with or releasing client money with the FCA’s express prior written consent.

Requirement 3

HCS must not in any way dispose of or deal with any of its assets without the FCA’s prior written consent.

Requirement 4

(a) HCS will send a daily attestation to the FCA at 16:00 hours stating that whether it remains in compliance with requirements 1 to 3.

(b) HCS will send this daily attestation to its supervisory contact and ensure it is signed by a holder of the director function (CF1).

None of the requirements apply to the extent that HCS has entered into special administration pursuant to the Investment Bank Special Administration Regulations 2011.

Definitions and interpretation

In this application:

(a) “client”; “client money” and “client bank account” has the meaning specified in the Glossary of the FCA’s Handbook.

(b) “the Financial Services Register” means the record in s.347 of the Act.

(c) “the Handbook” means the FCA’s Handbook of rules and guidance.

Back to top >