Restrictions placed on IBP Markets Limited and the Firm enters special administration

On 16 May 2024, under the terms of the restrictions placed on IBP Markets, the FCA received a request from the Joint Special Administrators to make an interim distribution of certain custody assets to which it consented on 17 May 2024. For additional information, please refer to the relevant progress update provided by Teneo[3].

The FCA has identified a number of serious concerns around the way that IBP Markets operates its business, including the Firm’s custody business activities and financial crime controls. 

The FCA has been working with the Firm to try and address these concerns, including agreeing voluntary restrictions on its regulated activities on 25 May 2023.

However, following serious concerns subsequently emerging around client money protections at the Firm, the FCA has determined that it is appropriate in the interest of protecting consumers to stop the Firm from carrying out regulated activities and has imposed these restrictions. 

On 25 May 2023, IBP Markets applied for the imposition of a number of requirements on its regulated activities including that IBP Markets must not accept any new clients. On 15 September 2023, the FCA imposed further requirements restricting the activities of IBP Markets and prohibiting the dealing and disposition of its own assets and those it holds for and on behalf of others. 

Having considered the Firm’s financial position following the imposition of the FCA restrictions, the Directors of IBP Markets applied to Court to place the Firm into Special Administration. 

Special Administration is a modified insolvency procedure for certain investment firms. 

Insolvency Practitioners are appointed by the court as special administrators in order to take control and manage the affairs of the Firm. 

The Joint Special Administrators have an objective to return client money and custody assets as soon as reasonably practicable, ensure timely engagement with market infrastructure bodies and the authorities, and either rescue the Firm as a going concern or wind it up in the best interest of the creditors. 

Clients can find more information about how they will be affected from the Joint Special Administrators as follows: 

• Website: www.ips-docs.com/case/IBPMA0001I/IBPTeneo2023[4]
• Email: [email protected] / [email protected] 
• Hardship enquiries email: [email protected]
• Helpline: +44 20 8159 0000 (the Firm); +44 121 619 0120 (Teneo)
• Post: IBP Markets Limited (in Special Administration), c/o Teneo Financial Advisory Limited, The Colmore Building, 20 Colmore Circus, Queensway, Birmingham, B4 6AT

The Joint Special Administrators will carry out an assessment of the client money and custody assets held by the Firm to confirm the current position. Following the assessment, the Joint Special Administrators will work to return client money and custody assets to customers in accordance with applicable law.  

The Joint Special Administrators will determine in due course how best to return the client money and custody assets. The Joint Special Administrators will write to direct clients of IBP Markets (for example wealth management firms and professional clients) with their proposals for the Special Administration within eight weeks of appointment. This will include further information on the process of making a claim.  

The Joint Special Administrators will carry out an assessment of the client money and custody assets held by the Firm to confirm the current position. Due to concerns about systems and controls in place to ensure adequate protection for client monies and custody assets at IBP Markets, this may take some time.  

This means that you will not be able to trade or otherwise use your custody assets or client money held with the Firm.  

Please speak to your wealth manager in the first instance. They will be able to update you about the Special Administration process and how you can engage with the Joint Special Administrators directly, if necessary. 

Costs associated with distributing client money and custody assets back to clients, including the special administrators’ fees will be deducted from the client money or custody assets.

The Financial Services Compensation Scheme (FSCS)[5] may cover the costs of distribution for eligible clients - see the information relating to the FSCS below.  

If you are a direct client of IBP Markets, you can contact the Joint Special Administrators for further information using the contact details above. Otherwise, please speak to your wealth manager.

You should proceed with caution if you are approached by a claims management company (CMC). For the vast majority of clients, there is no benefit in involving a third party in reclaiming your assets. If you use a CMC to assist in the return of your assets, the CMC is likely to seek a fee which may reduce what you get back.  

If you are considering using a CMC to assist with the return of your assets, we suggest you first discuss this with the Joint Special Administrators using the contact details provided above.  

The Financial Services Compensation Scheme (FSCS)[5] protects consumers when financial services firms fail. It is the compensation scheme for customers of UK authorised financial services firms. It has eligibility criteria both in respect of the people and businesses who are covered.  

Where the conditions for protection are met, the FSCS will cover custody assets and client money shortfalls up to £85,000 including the costs associated with their distribution back to clients. As to whether the conditions are met is a decision for the FSCS. 

The Joint Special Administrators will work with the FSCS to determine the position of eligible clients and will provide further updates soon. 

No action is required by consumers at this stage. However, if the current situation is causing immediate financial hardship and you are a direct customer of IBP Markets, please make the Joint Special Administrators aware of your circumstances using the contact information above. If you are not a direct customer of IBP Markets, please contact your wealth manager. 

If you are a direct customer of IBP Markets please make the Joint Special Administrators aware of your circumstances using the contact information above. Otherwise, please contact your wealth manager.

All customers should remain alert to the possibility of fraud. If you are cold called by someone claiming to be from IBP Markets or Teneo please end the call and call the Joint Special Administrators using the details set out above. 

IBP Markets is still authorised by the FCA and remains subject to supervisory oversight and the FCA’s rules. The Joint Special Administrators are officers of the Court and need to comply with all insolvency law.

The individuals appointed are authorised to act as licensed insolvency practitioners by the Institute of Chartered Accountants in England & Wales (ICAEW). We are liaising closely with the Joint Special Administrators during the course of the administration.