Please see below the protections in place for your cash and assets.
Client Money
Client Money is held in segregated pooled Client Money bank accounts. These accounts have trustee status, meaning that credit balances cannot be set off against any debts or obligations of AJBS. Client Money held by AJBS is subject to controls and procedures as required by the FCA.
Custody Assets
Clients’ stock is held by Lawshare Nominees Limited, a non-trading company which is a wholly owned subsidiary of AJ Bell. As a non-trading company, it has no liabilities of its own. All custody assets are subject to controls and procedures as required by the FCA.
Clients’ stock that cannot be directly registered into the name of Lawshare Nominees Limited is held to the order of AJBS by an approved third-party custodian. Formal due diligence on third-party custodians is carried out in accordance with FCA rules.
AJBS do not lend any stock registered in their nominee name or held to their order.
Financial Services Compensation Scheme
Assets held by AJ Bell are protected under the Financial Services Compensation Scheme (“FSCS”). The FSCS operates three separate schemes for deposits, investment business and contracts of insurance. Maximum limits for compensation apply in the event of a failure of an FCA-authorised firm, these limits are currently per person and per firm as follows:
· Deposits: £85,000 – for claims against firms declared in default from 1 January 2011 (100% of the first £85,000).
· Investments: £85,000 – for claims against firms declared in default from 1 April 2019 (100% of the first £85,000).
· Long-term insurance (e.g. insured pension plans and life assurance): Unlimited – (90% of the claim).
There are qualifying conditions under which the FSCS can make compensation payments, these are:
· There must be a ‘relevant person’ in default. This means an FCA-authorised firm or an Appointed Representative who is unable, in the opinion of the FSCS or FCA, to satisfy a claim against it.
· There must be an eligible claimant. The FSCS essentially only covers individuals (and some small companies).
· There must be a protected claim. A valid claim under a civil liability owed by the firm to the claimant.
Further information on the FSCS is available on its website www.fscs.org.uk
The document at the below link provides more information on the banks that we use and how you are protected through the FSCS.
As far as our reconciliations procedures are concerned, we run a variety of different checks depending on the volume of money or assets and also activity associated. We run reconciliations for client money daily.
The FCA recommend that stock reconciliations are conducted “when necessary”, however we consider our current practices in excess of benchmarks.
The vast bulk of stock is held in accounts which are reconciled on a weekly basis (this would include the majority of funds and listed securities, e.g. equity shares, ETFs, bonds). Different accounts are reconciled less frequently, depending on the factors mentioned above.
I hope this information is of assistance and provides you with some reassurance and peace of mind about the security of your money and assets when held with AJ Bell.