In the current financial climate, both legal practices and clients alike are taking a greater interest in the security of monies deposited in financial institutions. The Financial Services Compensation Scheme ("FSCS") covers deposits in authorised deposit taking institutions belonging to individuals or small businesses (including partnerships, sole traders and limited companies (but see 7 below)). Please note the following:
- In the highly unlikely event that our bank was to fail, it is unlikely that we will be held liable for losses resulting from that failure.
- Client money is deposited with HSBC Bank Plc.
- The £50,000 FSCS limit applies to the individual client, and so if a client holds other personal monies themselves in the same bank as our client account (including joint, partnership and sole trader accounts), the limit remains £50,000 in total.
- Some deposit taking institutions have several brands, i.e. where the same institution is trading under different names. Clients should check either with their bank, the FSA or a financial adviser for more information.
- Any money owed by a client to the banking group, under whatever brand, will be offset against the £50,000 protection, meaning a client may receive less than £50,000
- In order for a client to benefit from the FSCS, we may have to disclose relevant information about the client to the FSCS in the event of a bank failure.
- 3 - 6 above only covers deposits belonging to limited companies if they can meet two of the following criteria:
a. there is an annual turnover of less than £6.5m
b. the balance sheet has a total of less than £3.26m
c. the company has fewer than 50 employees
