Rely on the most comprehensive, up-to-date legal content designed and curated by lawyers for lawyers
Work faster and smarter to improve your drafting productivity without increasing risk
Accelerate the creation and use of high quality and trusted legal documents and forms
Streamline how you manage your legal business with proven tools and processes
Manage risk and compliance in your organisation to reduce your risk profile
Stay up to date and informed with insights from our trusted experts, news and information sources
Access the best content in the industry, effortlessly — confident that your news is trustworthy and up to date.
With over 30 practice areas, we have all bases covered. Find out how we can help
Our trusted tax intelligence solutions, highly-regarded exam training and education materials help guide and tutor Tax professionals
Regulatory, business information and analytics solutions that help professionals make better decisions
A leading provider of software platforms for professional services firms
In-depth analysis, commentary and practical information to help you protect your business
LexisNexis Blogs shed light on topics affecting the legal profession and the issues you're facing
Legal professionals trust us to help navigate change. Find out how we help ensure they exceed expectations
Lex Chat is a LexisNexis current affairs podcast sharing insights on topics for the legal profession
Discuss the latest legal developments, ask questions, and share best practice with other LexisPSL subscribers
Jen McCormick of Pinsent Masons LLP looks at this recent High Court case, which says that the requirement for special administrators to carry out a client money reconciliation 'immediately' after being appointed means that they must begin the process immediately, not that they must complete it straight away. The judgment clarifies Regulation 10H of the Investment Bank Special Administration Regulations 2011 and should remind prospective special administrators of the urgency and importance of the client asset reconciliation exercise.
What was the background?
Following the collapse of Lehman Brothers in 2008, the investment bank Special Administration Regime (SAR) was introduced to deal with failed investment banks or other firms that deal with client assets.
Investment management firm Strand Capital Limited, operated mainly as a discretionary fund manager. It applied to court to formally initiate insolvency proceedings under the SAR. As part of the application, clarification was sought as to whether the special administrators, once appointed, would be able to comply with the inherently contradictory obligation to undertake a reconciliation of client assets 'immediately' on their appointment in accordance with regulation 10H of the Investment Bank Special Administration Regulations 2011, SI 2011/245 (IBSAR 2011). This requires that: ‘immediately after being appointed as the administrator[s], the administrator[s] must carry out a client money reconciliation…’.
What did the High Court decide?
The High Court said that special administrators should be appointed for Strand, and considered the trickier question of the interpretation of IBSAR 2011, Regulation 10H.
The requirement to carry out a reconciliation arises because, on appointment, the special administrators take control of two separate types of asset classes: i) firm money and assets, which belong to the firm and can be used to pay-off creditors in line
Access this article and thousands of others like it free by subscribing to our blog.
Read full article
Already a subscriber? Login
0330 161 1234