Administrators have been called in to Logic Investments after it did not have sufficient funds to pay out redress.
On January 16, the company entered special administration, a month after the Financial Conduct Authority prevented it from accepting new clients without consent from the regulator.
Logic Investments is FCA authorised and regulated to provide wealth management services.
Alex Watkins and Ed Boyle of Interpath have been appointed as joint special administrators.
A notice from the FCA said: “The joint special administrators will assess the client money and custody assets held by the firm to confirm the current position.
“Then they will work to return client money and custody assets to clients in line with applicable law.
“The joint special administrators will decide in due course how best to return client money and custody assets.”
A notice on Logic Investments’ website set out the firm entered administration as it did not have sufficient funds to meet potential redress liabilities.
It said the joint administrators will be assessing whether the company can be sold.
Logic Investments is currently under investigation by the Financial Services Compensation Scheme.
The FSCS said it is determining whether it is possible for FSCS to meet the costs of transferring client money and assets to a new broker.
It said: “If this is the case, it is likely that FSCS will pay these costs directly to the joint special administrators for eligible customers. This will take some time and we will provide updates when we can.”
The FSCS is not yet open to customer claims, though said it is aware some customers have made claims to Logic Investments and the Financial Ombudsman Service.
Both the FSCS and FCA warned customers to be aware of scams, with the FCA urging those affected to “proceed with caution” when it comes to claims management companies.
tara.o’connor@ft.com
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