Hoping someone can put my mind at ease with what will happen if in the unlikely circumstance Invest Engine goes bankrupt?
I know £85,000 is protected by the FSCS, but from what I gather that only applies to cash held in your account, not invested in an ETF.
I believe the ETF’s are held in your name in a client bank account so even if Invest Engine did go bust you are still the owner of your ETF’s.
My question is what happens then? If my ETF’s are in an ISA with Invest Engine, if they go bust are they still in an ISA? Or are they just ETF’s held outside an ISA, so now to transfer them into new ISA’s would you be restricted by the £20,000 per year limit?
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Excellent question. Hoping for some detail in the answer.
Well you don’t fill me with the greatest confidence tbh, but I suppose what happened to IceSave might be the closest to an answer I’ll get if there isn’t a definitive standard procedure for these circumstances.
@Omian Yes I’ve seen that thank you, but it doesn’t actually answer the question I asked at the end of my post.
Hi all,
First off, I feel I should just say we don’t foresee InvestEngine going bust; we have a longer term plan to grow the business etc. …but I complete get this thread is talking about worse case scenarios. So let me provide some more detail on the regulatory protections investors have in the UK, InvestEngine is regulated by the FCA.
Hopefully this will help answer some of the above Qs about spreadsheets & records.
CASS regulations & Audits – We’re regulated by the FCA and their Client Asset Sourcebook (CASS). I don’t want to get into the technical details here (they’re long & complex) but we have daily & monthly assets reconciliations (Cash and Stocks) processes. Both the internal & external reconciliation and overall robustness of these process are subject to FCA audits. There are InvestEngine senior individual who’s personally responsible for our CASS submission.
FCA financial solvency rules - the FCA has financial adequacy rules in place for businesses like ours, meaning we have to have a certain amount of capital I set aside to be allowed to trade. The FCA also has be happy with our financial plans/business model.
Independent Custody of Assets - Already mentioned in the thread
FSCS protection - Already mentioned in the thread
Hopefully this help answer some of the questions above. I see if we can put the above into a more detail FAQ with some more detail from our compliance team.
Thank you for your reply @tom.winterton I appreciate you taking the time to explain.
Yes the question was just a hypothetical worst case scenario, and I’m sure with the growing popularity of InvestEngine and with you adding other chargeable services like SIPP’s in the future you will be here for a long time to come.
However the question I asked was not directly answered in your post:
“If my ETF’s are in an ISA with Invest Engine, if they go bust are they still in an ISA? Or are they just ETF’s held outside an ISA, so now to transfer them into new ISA’s would you be restricted by the £20,000 per year limit?”
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Hey @BraveDave23 thanks for clarifying. Your ISA allowance/wrapper is allocated to you, irrespective of the platform that holds it. This means if anything happens to InvestEngine, you will have the option to transfer your ETFs/ISA allowance to another provider. Similar to a normal ISA transfer, all the information held on your contributions will be transferred to your chosen provider, so your funds are ring-fenced by the contributions you made in previous tax years. It’s also worth noting, the FSCS protect ETFs and you can read more about this here- Search | FSCS
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