Investment accounts

Authorised and regulated by the UK’s FCA to provide investment accounts, we are bound by CASS rules to segregate and protect client assets.

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Communication to clients, counterparties and suppliers

12 April 2021 / News
Author
Dolfin

On 12 March 2021, the FCA issued a First Supervisory Notice (FSN) on Dolfin Financial (UK) Ltd (Dolfin) imposing, without any prior notice, severe restrictions on Dolfin’s ability to conduct its business. Details of the FSN can be found on the following link: https://www.fca.org.uk/news/news-stories/restrictions-placed-dolfin-financial-uk-ltd

In summary, the effect of the restrictions is to require Dolfin to cease to carry on regulated activities without the written consent of the FCA. The only exception is that Dolfin may continue to hold client money and safeguard and administer custody assets held as at 12 March 2021 and to receive new client money or custody assets from, or on behalf of, existing clients as a result of specific items, such as dividends or coupons or as a result of corporate actions, including maturing bonds. Further, without the FCA’s prior written consent, Dolfin must not take any action which has, or may have, the effect of disposing of, withdrawing, transferring, dealing with or diminishing the value of client money or assets.

Dolfin was surprised and disappointed by the FCA’s actions, which occurred in the course of an on-going dialogue with the FCA. Despite the huge efforts made by Dolfin under the leadership of its new management team to de-risk the business, change Dolfin’s culture and business model and to ensure that the business is conducted in a fully compliant manner, it has not been possible to satisfy the FCA’s concerns.

As a consequence of the restrictions on Dolfin’s ability to carry on its business, and the attendant damaging publicity, the Board of Dolfin, having taken appropriate independent professional advice, has decided to commence the closure of its business. This has been a difficult decision to take, but our priority now is to ensure an orderly closure in a way which creates as little disruption as possible to clients and other stakeholders.

We will be working with the FCA towards closing any outstanding client positions and for the expedient return or transfer of all client monies and other assets. To date, the FCA has made it clear that it will only give authorisation for the withdrawal of client funds if there are exceptional grounds to do so in order to avoid unacceptable prejudice to the relevant client. However, we hope that we will be able to commence the process of returning client monies and assets on a less restrictive basis in the coming weeks.

In order to provide continuity of service for as many clients as possible, we are also exploring opportunities for transferring parts of Dolfin’s client book to other regulated service providers. Prior notice will be given to clients if any such transfer is agreed and FCA approval is obtained.

Continued Safe Custody of Client Assets and Monies

For clients with assets under Dolfin’s custody, please be reassured that title to your assets remains fully protected. Such assets are held on trust on a segregated basis and are regularly reconciled in full accordance with the FCA Handbook’s CASS (Client Asset Sourcebook) requirements. The system used by clients to login and view their statements remains live.

As noted above, at present, Dolfin is not able to return assets to clients freely and we are obliged to seek written consent from the FCA before making any transfer. The FCA requires specific reasons for why an exemption to the restrictions should apply in any instance and details of the specific harm that would arise if consent is not granted, with evidence of the specific harm. If you believe that there are exceptional reasons in your case to justify the immediate withdrawal of your funds (or part of your funds), please inform us and provide full supporting evidence. As we say above, we hope that we will be able to commence the process of returning client monies and assets on a less restrictive basis in the coming weeks.

For clients who have their assets booked with third-party custodians, there are no restrictions upon those custodians.

Working with our Suppliers and Stakeholders

Dolfin remains committed to our suppliers and stakeholders and we will continue to work with you during this difficult period in order to complete or resolve any outstanding business.

Future Developments

We will provide further information and updates in the coming weeks either by written communications or by way of notices posted to the Dolfin website (www.dolfin.com) as the wind down proceeds.

Further Information

For further information or if you have queries please contact your Dolfin relationship manager or other principal contact at Dolfin. Alternatively, contact us through the following email: [email protected] or call on +44 20 3883 1800.

 

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Investment accounts

Dolfin’s investment accounts safeguard securities and cash, while ensuring you or your clients can take full advantage of multi-asset, multi-currency, and multi-strategy investments.

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About us

Founded as a London-based wealth boutique in 2013, today we’re a diversified financial services firm with an international presence and our own bespoke technology platform.

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