The UK Financial Services Compensation Scheme (FSCS) has just provided an update regarding its investigation of Direct Market Touch (DMT).

The Scheme says it has now finished investigating Direct Market Touch. As a result, FSCS has started assessing claims.

Direct Market Touch (DMT) offered stockbroking/trading opportunities to investors, concentrating in the Plus/ISDX/Nex Exchange markets. Customers have made various allegations against this firm. They centre on its operating methods and include:

• anomalies in trading and reporting,
• concerns on the suitability of risk profiling.

Also, the firm appears to have placed a high concentration of transactions into a small number of companies with the same directors. This has raised potential concerns around conflicts of interest.

In November 2019, FSCS said it was accepting claims against DMT. The Scheme has been working with Hallbrook Partners Ltd (who represent a large number of customers), and other external bodies. They are helping the body get relevant documents that helped in reaching a view on whether there are valid claims against DMT.

During the course of the investigation, FSCS noted that the business operation of DMT was complex and involved different trading activities across various exchange markets. Hence, the assessment of information took some time.

In May 2020, FSCS said the process had moved to its legal team who were looking at DMT’s activities to identify any specific regulatory breaches.

Customers of DMT can find more information about the case here.