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FCA fines SEI Investments £900k for client money breaches

Asset management provider committed “serious breach” of rules, says FCA.

The FCA has fined asset and wealth management services provider SEI Investments (Europe) £900,200 for failing to adequately protect client money.

Under the FCA’s client money rules, firms are required to keep client money separate from the firm’s money in client bank accounts with trust status.

Firms that undertake client transactions and hold client money should perform daily client money calculations to check that they are segregating the correct amount of client money.

Between November 2007 and October 2012, the provider failed to perform internal reconciliations, failed to ensure any shortfalls or excesses were corrected, and failed to appreciate it was using a non-standard method of internal reconciliation.

On one occasion, an SEI employee who had not received any client money training manually adjusted SEI’s client money requirement from the £14m calculated to £932,000, on the basis that £14m was an unprecedented amount therefore inaccurate.

The regulator says no actual loss of client money occurred, but had SEI become insolvent its failings could have placed client money at risk. The average daily balance of the client money accounts during the relevant period was around £84.3m.

In a statement, SEI says there was no loss or detriment caused to customers.


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