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Criminal case ramped up
In early March 2023, the Financial Conduct Authority, responsible for regulating financial services firms in the UK, was granted permission by the High Court to pause the civil investigation into WealthTek and Dance to focus on the serious criminal offences of fraud and money laundering. The civil case can be reopened if necessary.
In witness statements provided to the High Court by the FCA, spokesperson Anthony Williams stated that the investigation so far had found “an increase of about £25.6 million in the sums flowing from WealthTek to Mr Dance” and “suspicious flows of client money and assets of about £21 million from WealthTek to Mr Dance in the period between 2014 and 2020”. Mr Williams also referred to Dance’s alleged crimes as “one of the largest frauds perpetrated by an FCA-regulated individual at an authorised firm”.
The Restraint Order for John Dance and Special Administration of WealthTek LLP remain in place while the investigation is ongoing.
We have been following the developments in the WealthTek LLP investigation story since it was announced that the Financial Conduct Authority (FCA) had shut down the wealth management firm in June 2023.
The WealthTek story so far
July 2023
As part of the investigation into WealthTek, its trading names Vertem Asset Management and Malloch Melville, and owner John Dance, special administrators brought in to deal with the firm’s administration, BDO, had found a potential shortfall of £81.4 million in client assets. As a result, the FCA froze the assets of the firm’s principal partner, John Dance, and launched a criminal investigation into him and the firm.
November 2023
It was reported that the FCA had obtained a restraint order against John Dance under the Proceeds of Crime Act 2022, the purpose of which was to preserve assets to make them available for any future confiscation order.
January 2024
The firm was put into default by the Financial Services Compensation Scheme (FSCS), the government backed financial lifeboat scheme which compensates customers after financial firms fail. However, the FSCS had still not opened up to client claims against the firm, stating:
“WealthTek LLP being declared in default] is an important step which needs to be made before we can process FSCS protection for WealthTek clients. There is still a considerable amount of work to do before customers can be reunited with money and assets and the issue of shortfalls addressed.”
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Next steps for WealthTek LLP clients
Joint Special Administrators (JSAs), BDO, announced in February 2024 that they would contact WealthTek clients regarding their Client Asset Statements; however, the FSCS website still states that it is not yet open to customer claims.
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TLW Solicitors’ view
“The fact that the High Court has granted a pause on the civil investigation to focus on the criminal activities related to WealthTek LLP shows just how serious the situation is and we appreciate how worrying this may be for former WealthTek clients.
If there are any current or former clients of WealthTek or any of the other firms in the partnership who believe that they have lost money due to the firms’ operations, I would encourage them to contact us for a no-obligation discussion, as we may be able to help on a no win – no fee basis.”
Get in touch
If you believe you have lost money due to WealthTek’s operations – or the operations of its trading names, Vertem Asset Management and Malloch Melville – the team at TLW Solicitors may be able to help. Please contact TLW Solicitors to explore your options.
