Tenet posts £4.5m loss and reveals PwC settlement

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Tenet has reported a pre-tax loss of £4.5m for 2012 and revealed it settled with PricewaterhouseCoopers over a £2m claim relating to collapsed network Berkeley Independent Advisers.

The network has made a much bigger loss for the year to 30 September than the previous year, when it posted a pre-tax loss of £290,809.

Tenet set aside £4.5m during 2012 to cover the cost of Arch cru and Keydata redress, first revealed by Fundweb sister publication Money Marketing earlier this month.

Tenet’s results, published on Companies House today, also reveal Tenet has agreed a settlement deal with PwC over the purchase of adviser contracts from Berkeley Independent Advisers.

The settlement has been included as part of the £4.5m provision for Arch cru and Keydata, but Tenet has not disclosed the settlement amount. The settlement was agreed in December.

PwC took legal action against Tenet last October in a bid to recoup over £2m relating to the purchase of adviser contracts from Berkeley Independent Advisers.

BIA was a subsidiary of Berkeley Berry Birch plc, which went into administration in March 2006. PwC was appointed as the administrator of BIA.

Tenet bought out contracts for a number of BIA advisers and pipeline business, which protected advisers’ income and accepted liability for clawbacks, just before BIA went into administration. Liabilities for past business remained with BIA and was passed to the liquidators.

PwC argued Tenet owed over £2m under the terms of the sale and purchase agreement, which Tenet disputed.

BIA is also at the centre of a High Court ruling which could change the way the Financial Services Compensation Scheme assesses poor advice.

A mortgage broker with BIA, Peter Sharratt, advised client Charmaine Emptage to exchange a £40,000 repayment mortgage for an interest-only mortgage of more than £111,000. She was also advised to invest over £70,000 in Spanish property.

The FSCS offered Emptage compensation of £11,522.98, on the basis it would not cover losses related to the unregulated Spanish property transaction. Emptage took her case to the High Court and won, but the FSCS appealed the ruling. Yesterday the FSCS lost its appeal.