FCA secures special administrators for Euro Exchange Securities UK
The High Court has confirmed the appointment of special administrators for Euro Exchange Securities UK Limited (EES). This follows the firm's cessation of trading last week due to significant financial crime risks identified by the Financial Conduct Authority.
Financial crime risks trigger intervention
The High Court's confirmation of special administrators for Euro Exchange Securities UK Limited (EES) stems from serious concerns regarding the firm's operations.
The Financial Conduct Authority (FCA) identified significant financial crime risks, including systemic weaknesses in EES's financial crime framework and safeguarding arrangements, alongside issues with its ownership and governance.
This led the FCA to require EES to cease regulated electronic money and payment services on June 4, 2026.
Duncan Perring and James Bennett of Teneo Financial Advisory Limited have been appointed as joint special administrators.
Since their provisional appointment, they have taken control of EES, secured significant material, and frozen funds.
Matthew Long, FCA director for payments and digital assets, emphasized the importance of payment firms meeting expected standards to prevent their use by criminals for money laundering, stating, 'Fighting financial crime is at the heart of our strategy.
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Safeguarding client funds
Special administration, under the Payment and Electronic Money Institution Insolvency Regulations 2021, differs from ordinary administration by prioritizing the swift return of customer funds.
It also mandates timely engagement with payment system operators and authorities, including the FCA.
Crucially, client funds held by EES are not protected by the Financial Services Compensation Scheme (FSCS), as it does not cover electronic money or payment services.
Instead, E-money firms like EES are required to 'safeguard' customer money by holding it separately.
The special administrators will now assess all customer funds to confirm their position and manage claims.
Customers are advised to contact the administrators directly with any concerns and to be vigilant against scams.
A clear signal to payment firms
This case marks a significant precedent as the first of its kind for the FCA, demonstrating its resolve to protect consumers and market integrity.
It underscores the critical importance for payment firms to maintain robust financial crime frameworks and stringent safeguarding arrangements.
The action sends a clear message that the regulator will use its full powers to ensure compliance and disrupt financial crime within the sector.