Blankstone Sington Declared ‘In Default’ By FSCS

By 2020, the firm had amassed a pension deficit and was looking for a new buyer. In November 2021, the FCA stepped in to prevent the firm from disposing of any assets or taking on any new business. Customers started withdrawing their funds, and the business suffered a pre-tax loss.

The company’s CEO and several members of management resigned, and there were concerns that suitable replacements could not be hired and, therefore, the company could not function normally. After no suitable buyers came forward to take on the firm, the only other option was to enter administration.

Blankstone Sington was placed in special administration in October 2023 following a Court Order under the Investment Bank Special Administration Regulations 2011. The FCA describes special administration as “a modified insolvency procedure”. The process is intended for failed investment firms which hold client money – and aims to keep that money separate from the firm’s assets.

According to the FSCS’ latest update on 6th February 2024, it believes “the firm owes money to its customers and cannot meet the costs of any claims itself”. Hence, Blankstone Sington Ltd has been declared in default.

The FSCS is a government-backed compensation scheme set up to protect customers from financial firms that have failed. It is able to pay up to £85,000 in compensation per individual, per institution. While the doors have not yet been opened to customers to make an FSCS claim against Blankstone Sington, work will go on behind the scenes in conjunction with the Administrators (JSAs).

The FSCS said:

“Before FSCS can make any compensation payments in accordance with the special administration process, the Clients’ and Creditors’ Committee and the Court must approve the JSAs’ Distribution Plan, which sets out how customers’ assets will be returned to them. How client money will be returned to customers will be set out separately. Both customer assets and client money are likely to be transferred to a new broker at the same time.”

Further updates will be shared in due course.

Sarah Spruce, Legal Director at TLW Solicitors, says:

“In relation to the Blankstone Sington collapse, the FSCS has said it will likely meet any losses suffered in relation to the costs of transferring client money to a new broker and the costs of transferring client assets to a new broker. For now, it is a waiting game, but we will monitor the case closely.”

Until the FSCS begins accepting claims in relation to the failed wealth manager Blankstone Sington, there is little that people can do but wait. However, you can use the time to find out more about the FSCS claims process and to make a decision on whether or not you are likely to need assistance.

FSCS claims can be complex, technically challenging, and time-consuming. TLW Solicitors have the experience and expertise required to present cases to the FSCS, ensuring claims are processed as quickly as possible, with the best results achievable for our clients.

Acting on a no-win, no-fee basis, we will make a free, no-obligation assessment of your case and let you know the best way to proceed.