THANKS VM
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THANKS VM
I have spoken to the FSA who confirm that Echelon WM have gone into liquidation. I hope it is okay to post these details on here, but I was given the name and phone number of the liquidator to call.
Contact: Blair Nimmo, at KPMG, 0131 22 22 000
I was put through to someone who took my contact details, and they will call me back.
Guessing it could take a while !
I think that is about all we can do for now.....
What is VERY annoying is that I have not even used the account since the end of last year. That will teach me to not to leave money lying around unused!
Contact: Blair Nimmo, at KPMG, 0131 22 22 000
I was put through to someone who took my contact details, and they will call me back.
Guessing it could take a while !
I think that is about all we can do for now.....
What is VERY annoying is that I have not even used the account since the end of last year. That will teach me to not to leave money lying around unused!
Hi guys,
also with funds tied into Echelon, I found this site referencing Echelon's liquidation:
What happened to Echelon Wealth management?
Does anyone know a reason why spreadbetting funds should not qualify for the same protection as shares/CFDs?
Thanks.
also with funds tied into Echelon, I found this site referencing Echelon's liquidation:
What happened to Echelon Wealth management?
Does anyone know a reason why spreadbetting funds should not qualify for the same protection as shares/CFDs?
Thanks.
David Kaye (solicitor and secretary of Echelon) has confirmed that Echelon is in temporary administration. The administrator is Victoria Hanlon of KPMG (Edinburgh) who are at:
Saltire Court
20 Castle Terrace
Edinburgh
EH1 2EG
Switchboard: 0131 222 2000
At this point, the funds are either available from Echelon's bank account or from the FSA up to the limit (£43K) but I'm hoping for proper clarification of the funds situation by the end of this week.
I'll post as soon as I know anything.
Saltire Court
20 Castle Terrace
Edinburgh
EH1 2EG
Switchboard: 0131 222 2000
At this point, the funds are either available from Echelon's bank account or from the FSA up to the limit (£43K) but I'm hoping for proper clarification of the funds situation by the end of this week.
I'll post as soon as I know anything.
chesterlady
Junior member
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Hi, it looks hopeful what we should get our money back up to 40k does anyone have any idea of a time frame ( are we talking weeks, months or longer).
also could anyone recommend a new broker for a new spread betting account
Its a shame about echelon I always found them very good and helpful
also could anyone recommend a new broker for a new spread betting account
Its a shame about echelon I always found them very good and helpful
FTSE in mouth
Member
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I heard a vicious rumour that the funds weren't segregated... Can anyone shed any fact on this rumour...
Also I heard one trader caused the mess. He took a huge position, got it wrong, Man Group margin called Echelon and they couldn't cover it as neither could the client.
Also I heard one trader caused the mess. He took a huge position, got it wrong, Man Group margin called Echelon and they couldn't cover it as neither could the client.
I have a few thousand with Echelon, and supposedly am being represented through the Traders University. They refused to say whether I may or may not lose money although at the course I was told funds were guaranteed up to 40K. All confusing..if I had realised they werent protected I wouldnt have used them. Sorry to be naive, but what does nonsegregated mean by the way?
stevespray
Experienced member
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Certain FSA regulations require that retail clients funds be held in a seperate (or series of) bank accounts away from the firms own money. This means that if the firm goes bust the clients funds are safe and are not considered assets of the failed firm.
You need to read the small print. You are looking specifically to see if a ) clients funds are segrigated, b ) are clients classed as 'retail clients', and c ) does it say anywhere that clients deposits become the firms money which, if the firm see's fit, will be returned to the clients on their request.
If you find any wording like (c) then you could certainly lose out since, from a legal perspective, you'll simply be classed as a creditor of the firm.
Do you have a copy of the Terms and Conditions? Are they available online?
Steve.
You need to read the small print. You are looking specifically to see if a ) clients funds are segrigated, b ) are clients classed as 'retail clients', and c ) does it say anywhere that clients deposits become the firms money which, if the firm see's fit, will be returned to the clients on their request.
If you find any wording like (c) then you could certainly lose out since, from a legal perspective, you'll simply be classed as a creditor of the firm.
Do you have a copy of the Terms and Conditions? Are they available online?
Steve.
Still no letter from the Liquidators - I am going to chase again on Friday
I have contacted the FSCS though and got the following reply:
------------------------------------
Thank you for your e-mail about potential claims against Echelon Wealth Management.
As you may be aware, The Financial Services Compensation Scheme (FSCS) is the UK's statutory fund of last resort for customers of financial services firms and may be able to help consumers if an authorised firm is unable to pay claims against it. The Scheme was set up under the terms of the Financial Services and Markets Act 2000 and protects deposits, insurance, investments and mortgage business.
The FSCS may be able to help customers of the firm if it is unable to pay claims made against it (described by us as being "in default"). The firm has not yet been declared in default by FSCS.
At this time claims for the return of funds or investments held by Echelon Wealth Management on your behalf, you should contact the administrators to register your claim. It would appear that the Echelon website has been updated to provide contact details for such correspondence: Echelon Wealth Management and you have spoken to them already.
In addition to this I am arranging the issue an Application Form for you to complete so we can investigate this matter further.
Any personal information you provide us with will be held by the Scheme in accordance with our data protection policy, which is on our website or available on request.
If you have any further questions about this matter please e-mail me, or telephone us on 020 7892 7300 and ask to speak to our Customer Services Team. For general information about FSCS, please visit our website at FSCS - Financial Services Compensation Scheme
I have contacted the FSCS though and got the following reply:
------------------------------------
Thank you for your e-mail about potential claims against Echelon Wealth Management.
As you may be aware, The Financial Services Compensation Scheme (FSCS) is the UK's statutory fund of last resort for customers of financial services firms and may be able to help consumers if an authorised firm is unable to pay claims against it. The Scheme was set up under the terms of the Financial Services and Markets Act 2000 and protects deposits, insurance, investments and mortgage business.
The FSCS may be able to help customers of the firm if it is unable to pay claims made against it (described by us as being "in default"). The firm has not yet been declared in default by FSCS.
At this time claims for the return of funds or investments held by Echelon Wealth Management on your behalf, you should contact the administrators to register your claim. It would appear that the Echelon website has been updated to provide contact details for such correspondence: Echelon Wealth Management and you have spoken to them already.
In addition to this I am arranging the issue an Application Form for you to complete so we can investigate this matter further.
Any personal information you provide us with will be held by the Scheme in accordance with our data protection policy, which is on our website or available on request.
If you have any further questions about this matter please e-mail me, or telephone us on 020 7892 7300 and ask to speak to our Customer Services Team. For general information about FSCS, please visit our website at FSCS - Financial Services Compensation Scheme
stevespray
Experienced member
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Does anyone have a copy of the Terms & Conditions / Customer Agreement which they can post here or place here as an attached file?
Steve.
Steve.
One point to check if anyone has a customer agreement is whether all funds are segregated, or whether just unencumbered funds. I've noticed a few firms recently claiming that they segregate client money, but in the small print it turns out just to be free cash (i.e cash used as deposit is not segregated). This means that if you have a position, the company can use this deposit money to margin its own positions, and in cases like Echelon and GT247, you can be wiped out by someone else's debt. According to MiFID all client assets should be segregated, but it looks as though some of the dodgier companies are pushing the definitions, and the FSA can't be bothered to do anything about it.
Does anyone have a copy of the Terms & Conditions / Customer Agreement which they can post here or place here as an attached file?
Steve.
Hi Steve,
Please find attached a copy of the risk disclosure form from Echelon Wealth Management Ltd. I am- as I found out later- an intermediate customer, so not protected as a private customer would have been. What a mess...
Attachments
chesterlady
Junior member
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Hi Steve, I to have money in echelon I joined through the traders university, could you please explain the difference between an intermdiate customer and a private customer, I would be very grateful
lynda
lynda
stevespray
Experienced member
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Hi Steve,
Please find attached a copy of the risk disclosure form from Echelon Wealth Management Ltd. I am- as I found out later- an intermediate customer, so not protected as a private customer would have been. What a mess...
OK - The risk disclosure form is merely warning you about things that you should check out - It's not part of the T&C's - It's warning you that you should be aware of certain things which the T&C's may contain which may or may not represent a 'risk' to you or your capital.
If you've been designated as an 'Intermediate client' then you might not have very much in the way of asset protection. Some of this will depend on what the T&C's sets out. Quite a few firms out their are 'keen' to classify clients as 'intermediate' as this effectively lowers liability for them. In some cases your capital deposit will be classed as an asset of the firm and not yours. All of this effectively renders you as a creditor of the firm which means that you will get paid out at X pence in the £ just like anyone who is a creditor.
You might want to check weather being classified as 'intermediate' removes your rights under the FSA scheme for protecting clients capital.
Technically speaking to be classified as 'intermediate' the firm would have to vet you and check that you were suitable for such an account. You can't just classify a client like that. Most clients of Spread Bet firms are classed as 'retail clients' and therefore receive maximum protection in circumstances like this.
Steve.
Riftvalley
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Hi I thought it may be of interest to look at MiFID – Questions and answers although this is a Finnish document it is very clearly written and explains what MiFID is.
Also it contains this definition:-
Professional clients are defined in the law as clients with experience, knowledge and expertise sufficient for making independent investment decisions and assessing the risks involved.
If a client has not been a professional investor up to now but would like to be classified as one from now on, he or she may ask the service provider in writing to be treated as a professional client. This cannot, however, be done unless the client meets at least two of the following three requirements:
- The client has carried out transactions significant in size ( €50,000 or more) in the markets involved at an average frequency of ten times per quarter over the past four quarters.
- The size of the client’s investment portfolio is more than €500,000.
- The client works or has worked in the financial industry for at least one year in a professional position, which requires knowledge of the transactions or services envisaged.
Yet another requirement is that the service provider has estimated the client to be capable of making independent investment decisions and understanding the risks involved and that the service provider accepts the client’s application for reclassification.
I don't think many TU graduates qualify as professional clients under this law which became operative on 7th Nobember 2007! The only classifications are professional or non-professional. I don't think that as of Nov 7th 2007 that 'intermediate' has any meaning at all.
Also it contains this definition:-
Professional clients are defined in the law as clients with experience, knowledge and expertise sufficient for making independent investment decisions and assessing the risks involved.
If a client has not been a professional investor up to now but would like to be classified as one from now on, he or she may ask the service provider in writing to be treated as a professional client. This cannot, however, be done unless the client meets at least two of the following three requirements:
- The client has carried out transactions significant in size ( €50,000 or more) in the markets involved at an average frequency of ten times per quarter over the past four quarters.
- The size of the client’s investment portfolio is more than €500,000.
- The client works or has worked in the financial industry for at least one year in a professional position, which requires knowledge of the transactions or services envisaged.
Yet another requirement is that the service provider has estimated the client to be capable of making independent investment decisions and understanding the risks involved and that the service provider accepts the client’s application for reclassification.
I don't think many TU graduates qualify as professional clients under this law which became operative on 7th Nobember 2007! The only classifications are professional or non-professional. I don't think that as of Nov 7th 2007 that 'intermediate' has any meaning at all.
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