Central Bank invokes Investor Compensation Scheme regarding Asset Management Trust Limited

The Central Bank has made a determination regarding Asset Management Trust Limited in accordance with Section 31 of the Investor Compensation Act 1998 Act. The Central Bank has determined that it appears that the firm is unable for the time being, for reasons which are directly related to its financial circumstances, to meet its obligations arising from claims by clients and has no reasonably foreseeable opportunity of being able to do so.

The Investor Compensation Company Limited, which operates the statutory compensation scheme for investors, will shortly write to the Firm’s clients. Mr Des Ritchie, of the Central Bank, has been appointed as Administrator to assess and certify claims for compensation made by clients of the firm.

Full notice:

The Central Bank has made a determination regarding Asset Management Trust Limited (‘AMT’, ‘the Firm’) in accordance with Section 31 of the Investor Compensation Act 1998 Act (‘the Act’) and has appointed Mr Des Ritchie, of the Central Bank, as Administrator to assess and certify claims for compensation made by clients of the Firm.

The Central Bank has determined that it appears that the Firm is unable for the time being, for reasons which are directly related to its financial circumstances, to meet its obligations arising from claims by clients and to have no reasonably foreseeable opportunity of being able to do so.

The Investor Compensation Company Limited (‘ICCL’), the company that operates the statutory compensation scheme for investors, will shortly write to the Firm’s clients and place notices in national newspapers inviting applications for compensation in circumstances where AMT failed to return money or investment instruments which clients entrusted to AMT. In accordance with the provisions of the Act, clients have until 27 July 2016 to make a claim for compensation.

The ICCL will pay compensation where an authorised firm is unable due to its financial circumstances to return money or investment instruments owed to a client and where the Administrator has certified the loss to the ICCL. The certification of claims is carried out by the Administrator.

Losses caused by a fall in the value of investments because of market or other economic events are not compensatable by the ICCL. Compensation is limited to 90% of an eligible investor’s net loss as certified by the Administrator or €20,000 whichever is the lower for each eligible investor.

The Act requires that certified claims are paid within three months of certification by the Administrator. At this juncture it is difficult to estimate the period of time that may elapse before the Administrator has sufficient evidence to certify a claim. However, if a claim is certified, the ICCL aims to make payments within two weeks of certification.
Further information on the operation of the scheme is available on the website www.investorcompensation.ie in addition to an information booklet for investors available from the Publications section.

All former clients of AMT who believe they may be eligible to claim compensation can direct their queries to [email protected] or the ICCL can be contacted on 01-224 4955.

Notes

• AMT was a participant in Fund B of the Investor Compensation Scheme and all certified compensation payments will therefore be settled from Fund B.

• AMT was authorised as an authorised advisor under the Investment Intermediaries Act 1995 (as amended) and registered as an insurance intermediary under the EC (Insurance Mediation) Regulations 2005. The Firm was not authorised to hold client assets

• The Central Bank received information which gave rise to concerns on its part regarding the Firm’s compliance with specific regulatory requirements in March 2014. The Central Bank conducted inspections of the Firms’ books and records which led to a series of directions being imposed on the Firm in the interests of protecting clients.

• To ensure full disclosure with regard to the provision of information under the Consumer Protection Code, the Central Bank also engaged with all product producers that had appointed AMT as their agent/intermediary requesting them to contact their clients directly to confirm current holdings and values.

• The Central Bank continued to engage with AMT regarding the outstanding regulatory issues and in March 2015, AMT voluntarily revoked its authorisation and cancelled its registration with the Central Bank. AMT signed a referral agreement with another regulated entity and AMT provided their clients with relevant contact details.

• In the course of its investigations, the Central Bank was alerted by clients of AMT to circumstances whereby the firm may have exceeded its contractual authority. Such circumstances may give rise to a compensatable loss under the Investor Compensation Scheme.

• Due to some of the risks highlighted by this case, the Central Bank commenced a themed inspection in 2015 on other firms in this sector, and work is on-going throughout 2016.