Smith & Williamson to oversee Dolfin Financial administration

06 July 2021 2 min. read

Professionals from Smith & Williamson have been installed for the special administration of a UK financial services firm. The news comes after the UK’s financial watchdog placed restrictions on the activities of Dolfin Financial, having stated “serious concerns” at how the company was being run.

Dolfin Financial was a wealth management firm based in the UK, with around 500 clients and 30 staff. Until March 2021, it provided discretionary, advisory and execution-only services to retail and professional clients on a range of investment securities. These included shares, government and corporate bonds, and investment funds. The firm also provided Tier 1 investor visa services.

However, the Financial Conduct Association would eventually scupper these operations, when it forced wealth manager Dolfin Financial to cease its activity citing "a number of serious concerns around the way that Dolfin operates its business." The concerns reportedly centred on the way that Dolfin operated its business, including the firm's Tier 1 investor visa business activities and financial crime controls.

Smith & Williamson to oversee Dolfin Financial administration

The FCA initially worked with Dolfin while it took steps to try and address these concerns, including imposing voluntary restrictions on its regulated activities on 24 December 2019, and commissioning a Skilled Persons Review. After the review, however, the FCA determined that it was appropriate in the interests of protecting the integrity of the UK financial system to stop the firm from carrying out regulated activities. As such, it imposed restrictions preventing Dolfin carrying on any regulated activity, and prevent it from reducing the value of its assets, or any of the client money or custody assets it holds, without the consent of the FCA.

Since the announcement of the restrictions, Dolfin’s board has been working to wind down the business along with transfer client monies and assets to a new provider, subject to approval from the FCA. At the time of its collapse, Dolfin had £120 million of client money and £1.3 billion of custody assets on its books.

After a reassessment of the company's financial position in the light of progress with this wind down plan, Dolfin's board agreed to place the business into special administration in early June. Dolfin subsequently appointed Adam Stephens and Kevin Ley of Smith & Williamson as joint special administrators.

Stephens stated, "The priority for the joint special administrators is to identify, protect and in due course return client money and custody assets to clients in accordance with their interests… The joint special administrators are continuing to hold detailed discussions with the intended acquirer with a view to finalising the terms of any transfer."