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Strand Capital DFM Claims

Stand Capital DFM may soon be no more, entering Special Administration after it’s owners notified the FCA of their intention to apply for a voluntary wind-up following financial statements that reveal difficulties for the firm.

The FSCS expects to pay around £6,000,000 in compensation to former clients who claim.

Initially reported on by Citywire, the London-based DFM which was bought by Optima Worldwide back in 2014, has around £86Million under management throughout a range of DFM portfolios, and now has restrictions on it from the Financial Conduct Authority.

Do YOU have an account with Strand Capital as part of your SIPP Pension?

It’s seldom a good sign when your investment company goes into administration, and even if you have had compensation it may be that a claim could be made to your financial adviser for unsuitable advice.

Get in touch with the Claims Specialists at Spencer Churchill Claims Advice for a FREE Initial Assessment to see if you can make a claim for compensation with no upfront costs!

Please note: No Win – No Fee*: Successful claims made through Spencer Churchill Claims Advice are subject to the Success Fee, charged as per your terms of business and engagement letter of any monies awarded to the claim. Clients have a 14 day “Cooling-Off” period during which time they may cancel at any time without charge. After this time, cancellation will result in the application of the Cancellation Fee. 

*Figures calculated before deduction of Success Fee and taxes 

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Smith and Williamson and Strand Capital

Joint Special Administrators from Smith and Williamson were appointed to Strand Capital on 7 June 2017.

As administrators, their role is to effectively press pause on as much as possible of what the business is doing, assess the situation, and to try to ensure that the firm’s creditors and clients get paid, and to try to salvage the company as a going concern if possible.

According to the Administrator’s Progress Report (16 May 2019); ‘The JSAs concluded that a sale of the company as a going concern is not possible, and are winding it up in the best interests of creditors’.

According to the Administrator’s Proposal (July 2017), the background to the Special Administration included:

‘Around November 2016 there appears to have been a change in strategy for the company; most of the security investments were transferred to one or both of the following UCITs […]:

  1. 5Alpha Adventurous Fund
  2. 5Alpha Conservative Fund

[both funds mentioned] are traded on the Irish Stock Exchange.

The Company faced a number of challenges broadly dirived from finalising its contractual relationship with 5Alpha, and shareholder relations. The Shareholder entered into a limited marketing exercise to sell the Company or its business. No offers for the Company and its business were forthcoming, nor was it possible to agree terms for a management buy out of the business.’

‘[…] Mr Hamilton Keats ceased to act as director as of 20 March 2017 […]
From this date it appears to be the case that the Company was no longer in a position to continue to trade as it no longer had access to the trading platform as a result of Mr Keats and other key personnel leaving the business.’

Can you claim for Strand Capital compensation?

It could be that you’ve already received some compensation over the Strand Capital fiasco, with the first tranch of repayments from the Special Administration paying around 65p the every £1 invested. But could you make a claim against a financial adviser for having recommended Strand Capital in the first place?

If you:

  • Took advice from a financial adviser
  • Transferred your pension to a SIPP
  • Invested via Strand Capital
  • Aren’t earning over £100k per year
  • Aren’t a Sophisticated Investor

Then you may have been mis-sold, and you could be able to make a claim for negligent SIPP advice.

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Strand Capital Timeline of Events

1999 - Company's UK Formation

Strand Capital began life in 1999 as Interactive Clearing Services Limited, but according to the Administrator’s Proposal, the firm did not appear to begin trading until 2002.

2014 - Optima Worldwide Group

Strand Capital was purchased by Optima Worldwide Group Plc in January 2014, with Mr Hamilton Keats as Director.

Until 2016, the only investments arranged by Strand Capital were into the OWG bonds.

2016 - Change of strategy

After November 2016, most security investments go into the two 5Alpha funds.

2017 - Resignation and FCA

2017 saw Hamilton Keats resign, and FCA restrictions began, resulting in the firm’s current status of Authorised In Special Administration and told to ‘Cease all regulated business and retain all assets’.

2019 - Claims Continue

While the news that the FSCS will compensate 2,500 investors over Strand will be welcome, the FSCS does have it’s limits and this does not include claims that could be made for the negligent financial advice of any advisers who may have not acted suitably over investments through Strand.

Strand Capital DFM

A DFM stands for Discretionary Fund Management/Manager – a firm that creates and manages portfolios of investment bonds for clients to invest in.

Generally, these portfolios are grouped by investment type (such as property, industries etc) and/or by the risk they represent to the investor’s money.

But both financial advisers and DFMs can get it wrong, mis-matching investors who would be suitable for low risk funds with high-risk DFM portfolios.

The mis-selling of DFMs through SIPPs has come to the FCA’s attention in recent years, with the regulator referring to some cases as a “third generation scam”.

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Strand Capital Related Claims

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Strand Capital FAQ's

Who are Optima Worldwide Group Plc?

Optima Worldwide is firm that describes itself as focusing on identifying and investing in unique opportunities around the globe.

It purchased Strand Capital in 2014.

Can I claim against Strand Capital?

If you invested with Strand, it may be that you’ve already received compensation. However, you may be able to make a claim against a financial adviser if they gave you negligent advice over Strand or your pension.