IFA firm to enter administration following £6m Keydata claims
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IFA firm Target Financial Management is to enter administration following £6m of claims relating to Keydata.
Bath-based TFM, which has 28 employees, is part of the group Target Chartered Accountants, which has around 197 employees. Subsidiaries Target Consulting Group and Target Consulting entered administration on Friday and TFM is expected to enter administration imminently. Administrators have not yet been appointed to Target Chartered Accountants, which is based in London.
Target Financial Management was among the firms being pursued by the Financial Services Compensation Scheme to recoup compensation paid to Keydata claimants.
Law firm Herbert Smith has written to Keydata distributors on behalf of the FSCS to kick-start the legal process of pursuing recoveries.
In January, the FSCS imposed a £326m interim levy on the industry, mainly to cover the costs after Keydata collapsed. Advisers paid £93m while fund firms paid £233m.
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Readers' comments (21)
Paul Howard | 28 Nov 2011 2:00 pm
Wow - 28 employees somehow generated £6 million of claims?
There were busy selling Keydata!
One can only hope the senior management of TFM don't get away with dumping their laibilites and then forming a new firm with the assets (i.e. clients) of TFM.
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Chris F | 28 Nov 2011 2:07 pm
How about if the "advisers" who sold the Keydata have since moved on and the 28 employees who are now on the dole had nothing to do with it?
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Evan Owen | 28 Nov 2011 2:18 pm
OK. If the FSCS has already paid out then the bill for this collapse and further Keydata claims will not fall on the rest of the 'members'? But everything else these people sold will? Sorry if that sounds confused.
Is there any PI insurance?
What a shambles.
Who else is sick and tired of regulation as we know it?
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Anonymous | 28 Nov 2011 2:18 pm
But I thought that all clients could rely on a firm with Chartered in their title? Wasn't that what RDR was all about?
Oh yes, they can rely on it as the F-pack will force through redress whether the advice was flawed or not.
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Anonymous | 28 Nov 2011 2:19 pm
I suspect that the catalyst for the demise of TFM was not Key Data, but the highly geared growth of TCA.
It is unfortunate that the latest blog on their website is entitled, "selling out".
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Paul Howard | 28 Nov 2011 2:39 pm
Chris F
Yes - I do feel sorry for the Admin Team and Advisers who didn't recommend Keydata - all they will have got out of this will be redundancy.
....andf a quick look at the FSA register* shows only 2 advisers have been there over 2 years - the most of the CF's having joing in the last 18 months.
So yep - looks like the people who might have done the selling are long gone.
* - And a little worryingly - still show as Authorised as a firm!
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Exasperated Me | 28 Nov 2011 3:58 pm
What was their 'compliance' officer doing?
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Anonymous | 28 Nov 2011 4:14 pm
It has just been announced that the Farepak windup fees have exceeded the compensation.
Watch this space.
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Julian Stevens | 28 Nov 2011 4:37 pm
On the question of PII, maybe it was the excess per claim that sunk the ship. 150 claims with a £10K excess on each and you're looking at £1.5m which is well enough to break most businesses.
That aside, it can't be much longer before PI insurers refuse to provide cover in respect of FSA-orchestrated hindsight reviews to cover up its own regulatory failings. What will the FSA do then? Probably just plough ahead regardless and wipe a few hundred more IFA firms off the map, all in keeping with the Grand Extermination Plan. And yet, incredibly, these people actually believe they're doing a good job and making the world a better place.
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Simon Kershaw | 28 Nov 2011 4:44 pm
Any doubt I may have entertained as to the intention of the FSA and its legions to kill off all IFAs has now evaporated.
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