Professional Services
Forvismazars
Full Credential Description
Pritchard Stockbrokers Limited faced significant challenges after being forced to cease trading by the Financial Authority (FSA). The FSA raised concerns regarding the companys failure to adequately protect client assets and the improper use of client money for its own account. With approximately 11,000 clients and assets exceeding £400 million, the situation was critical. Prior to the appointment of Mazars, the directors had attempted to sell certain assets, including customer lists and client stock assets, but failed to transfer these stock assets properly, complicating the situation further. Mazars approach involved detailed reconciliations and transfers of clients stock assets, which were valued at around £400 million. The team conducted thorough investigations into the client monies held by the company, uncovering a significant shortfall. They meticulously reconciled all client records to determine the amounts owed to each of the 11,000 clients, aiming to return as much of the client assets as possible in line with the objectives of the special administration. Throughout this process, Mazars collaborated closely with the FSA and later the Financial Conduct Authority (FCA), providing regular updates on their findings and the management of client assets. The impact of Mazars work was substantial. Their investigations maximized potential recoveries and led to a significant settlement in a related dispute. Additionally, the actions taken resulted in two directors being fined and banned from the financial industry for their reckless conduct, while the Managing Director and Financial Director faced disqualifications of 8 and 6 years, respectively, for misleading the FSA and breaching financial regulations regarding client funds.