The FCA-regulated broker Alpari UK has not finished its painful procedure yet and it is more than 19 months since it had to ask for help due to its bankruptcy. New udpate has just been published in this case.
The well-known broker has entered bankruptcy proceedings after heavy losses due to the Swiss Franc spike of January 15, 2015 as the Swiss national Bank removed the cap from the EUR/CHF currency pair.
Special Administrator KPMG has published a further update on its work related to the Alpari UK. KPMG stated that it accounted for and recovered virtually all $98.2 million of client money at Alpari UK. There was also the money held at the four e-Wallet providers used by Alpari UK which were not subject to client money segregation rules.
Among asset sales, the only interesting real item remained $1.22 million, occurring from the sale of Alpari UK’s client list to ETX Capital.
Nevertheless, KPMG added that now the Alpari clients should eventually receive back 78.3 to 79.7 cents on the dollar when all is said and done from the Estate, or about $77 million.
$51.3 million had already been returned by now. But where is the rest of the money?
Well, every such procedure asks for fees and that’s where those money are lost. The largest portion of fees shall be paid to KPMG, which makes more than half of the overall total. KPMG has charged to the case to date £11.9 million.
KPMG calculated for his work 28,093 hours at an average rate of £423 per hour. But as a result of discussions with the Creditors’ Committee, KPMG has agreed to a cap on its fees of £10.5 million, or about USD $15 million.
As for the other fees, they include legal fees, reaching approximately $2.5 million, while salaries paid to retained staff (all of whom were terminated as of last September 30) of $2.4 million.
So we can expect Alpari UK clients to get back something near 80 cents on the dollar from the Bankruptcy Estate, with the whole process asking for two years to be finished. Those clients who had less than £50,000 in their accounts at Alpari UK should be able to get back most if not all of the rest from the FSCS.
The KPMG fresh report can be seen here.
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