UK compensation scheme continues investigation into Direct Market Touch
There is still more information to consider before FSCS can say it has reached a conclusion about the allegations made against the firm.
The UK Financial Services Compensation Scheme (FSCS) has published an update regarding its investigation into the activities of Direct Market Touch (DMT).
Investigations into whether DMT owes a civil liability to customers are ongoing, the Scheme said, adding that the business operation of DMT is complex and involves different trading activities across various exchange markets. There is still more information to consider before FSCS can say it has reached a conclusion about the allegations made against the firm.
In the meantime, FSCS remains in contact with external bodies including the Financial Conduct Authority and IP Kallis & Co who are helping with the investigation, where possible.
Direct Market Touch offered stockbroking/trading opportunities to investors, concentrating in the Plus/ISDX/Nex Exchange markets.
FSCS explains that customers have made various allegations against this firm. These allegations centre on its operating methods and include:
- anomalies in trading and reporting,
- concerns on the suitability of risk profiling.
Also, DMT appears to have placed a high concentration of transactions into a small number of companies with the same directors. This has raised potential concerns around conflicts of interest.
FSCS is currently accepting claims against DMT, although these have not yet been passed to the claims teams for assessment. The body needs to establish whether there are valid claims against DMT first.