FSA said MWL was fined because it failed to obtain a trust letter in respect of 22 segregated off-shore retail client bank accounts, which contained an average balance of £666,000.
Under the FSA’s client money rules, firms are required to keep client money separate from the firm’s money in segregated accounts with trust status.
MWL missed several opportunities to review its client money arrangements in relation to these 22 off-shore accounts.
Richard Sutcliffe, head of the client assets unit, said the FSA has repeatedly emphasised the importance of ensuring that client money is adequately protected and firms of all sizes must ensure client money is segregated and that this is acknowledged with a trust letter in accordance with FSA rules.
