Third firm placed in special administration by FSA

The Financial Services Authority (FSA) has placed spreadbetting firm Worldspreads into special administration, the third firm to be targeted under the new powers.

Trading in Worldspreads’ parent was suspended by the Alternative Investment Market last week, pending an announcement, which revealed accounting irregularities.

The regulator claims the accounting irregularities made it unable to continue in business.

KPMG’s Jane Moriarty and Samantha Bewick have been appointed special administrators by the City regulator.

The administrators will review client cash holdings positions and “return as much cash as soon as practicable”.

Worldspreads is the third firm to be placed under the regime, following similar actions by the FSA towards Pritchard Stockbrokers and MF Global.

The Financial Services Compensation Scheme (FSCS) may be called upon if any losses are found. This month, the FSCS told investment intermediaries that they would face an interim levy of £60m to fund customer compensation claims, including the failure of MF Global.

The FSA is only permitted to place firms in special administration after consulting HM Treasury and the Bank of England.

Customers have been urged to contact the joint administrators for more information on 0203 284 8829.