When the Adviser Fails

Reacting to: EGR Wealth Limited enters administration — Financial Conduct Authority, 26 August 2026 →

The profession spends a great deal of energy on the question of whether an accountant should introduce a client to a financial planner at all. It spends almost none on the question that follows: what happens if that planner’s firm stops trading. On 24 August 2026 an FCA-authorised discretionary investment manager, EGR Wealth Limited, entered administration, and the FCA published its consumer guidance on 26 August. Nothing in that story is about accountants. It is still the most useful thing an accountant will read this week about how to run an introduction properly.

The reason is that firm failure is the one scenario where the difference between a well-documented introduction and a casual one becomes visible. In every other week the two look identical to the client. In the week a firm goes into administration, one of them leaves a practice able to say precisely who it introduced, when, on what basis and with what recorded, and the other leaves a partner searching an inbox. That is a filing question rather than a regulatory one, and it is entirely within a practice’s control.

What the FCA has confirmed

The facts, taken from the FCA’s own news story, are narrow and worth keeping straight. EGR Wealth Limited entered administration on 24 August 2026. Robert Goodhew and Geoff Bouchier of Kroll Advisory Limited were appointed joint administrators, who are officers of the court and must comply with insolvency law. The firm provided discretionary investment management services, managed client investment portfolios, and facilitated the transfer and administration of client investments. A month earlier, on 24 July 2026, it had agreed to a voluntary requirement restricting the activities it could carry out.

Two details in the FCA’s guidance are the ones that matter analytically. The first is that EGR Wealth remains authorised and supervised by the FCA and must still comply with its rules — administration does not remove a firm from the perimeter. The second is that the firm does not hold client money or custody assets. Those are held by a separate regulated firm under the client asset rules, which exist precisely so that assets survive the failure of a firm that has been dealing with them.

The distinction clients will not make on their own

That second point is where an accountant can be genuinely useful without straying anywhere near regulated advice. A client who hears that their investment manager has gone into administration will ask one question: is my money gone. The honest answer in a structure of this kind is that the holdings are held elsewhere and protected by rules written for this exact event, and that this is a separate question from whether the client has a claim about the advice or the management they received.

Those two things get collapsed into one another constantly. Custody protection answers “where are the assets”. It does not answer “was I advised properly”, and it does not answer “what happens to the complaint I already had in”. On that last point the FCA is blunt: because the firm is insolvent it will likely not have sufficient money to pay compensation in full where compensation is due, and that applies to clients awaiting a response, clients holding an unreturned offer of compensation, and clients who had already gone to the Financial Ombudsman Service.

Custody protection answers where the assets are. It answers nothing at all about the advice that put them there.

What compensation actually looks like

The Financial Services Compensation Scheme protects consumers when authorised firms fail, subject to eligibility criteria governing which people and businesses are covered. For investments, where the firm failed after 1 April 2019, the FSCS states that it can pay up to £85,000 per eligible person, per firm. Where the claim is about bad advice that caused a loss, the advice must have been given on or after 28 August 1988. The FSCS also states plainly that it cannot accept claims for poor investment performance alone. Those figures and conditions are published on the FSCS’s pages covering investments and were checked on 26 August 2026.

The cap is the number an accountant should have in their head, because it is the point at which a client’s intuition breaks down. Someone with a portfolio comfortably into six or seven figures tends to assume that compensation scales with the size of what they hold. It does not. It is a fixed ceiling per eligible person per firm, and it is one of the few genuinely useful reasons to ask, at the point of introduction, where assets will be held and by whom.

The FCA adds one more warning that translates directly into something a practice can pass on. Claims management companies approach clients after a failure of this kind. The FCA’s position is that clients should proceed with caution, that for most customers there is no benefit in involving a third party in reclaiming their assets, and that a CMC is likely to seek a fee which reduces how much money the client gets back. Clients who need free, impartial guidance can use MoneyHelper.

A worked example of the filing problem

The following is a composite built to show the shape of the exercise. It is illustrative, not a real client, and not a comment on any particular firm.

A four-partner practice has, over roughly five years, mentioned a financial planning firm to clients in year-end meetings. Nobody has counted how many. The introductions were made in the ordinary way: a sentence in a meeting, an email with two names on it, no central record. Then the firm fails.

• Day one. A client rings the partner who introduced them, not the administrators, because the partner is the person they trust. The practice has no list, so it cannot tell whether this is one call or the first of thirty.
• Days one to four. Four partners search sent items for the firm’s name. They find nineteen introductions, of which six were to clients who have since left the practice and two were made by a partner who has retired.
• Day five. For eleven of the nineteen there is no file note recording what was said or what the client consented to. What was actually said in those meetings now rests on individual memory, some of it five years old.
• Week two. The professional indemnity insurer is notified, as a precaution, of a set of introductions the practice cannot fully describe.

Nothing in that sequence involves the practice having done anything wrong. Every hour of it is the cost of not having written things down. The version of the same week in a practice that keeps an introductions log takes about forty minutes: pull the list, see there were nine, read the nine consent notes, send nine clients the administrators’ contact details and the FCA’s guidance page.

Two things worth doing this week

Build the list, even retrospectively. One sheet: client, date, firm introduced to, what the client consented to being passed on, and whether the practice was told what was implemented. If the practice has been introducing clients for years without one, an hour of searching now produces something that is useful in a dozen ordinary situations as well as this rare one. It is also the evidence that an introduction was a considered act rather than a favour, which is the distinction described in the anatomy of an introduction.

Check the firms you already use on the FCA’s Financial Services Register. Confirm the firm is authorised and that its permissions match the work being introduced. Ask, if it has never been asked, whether the firm holds client money and custody assets itself or whether they sit with a separate regulated firm. That question takes one email and it is the question that determines what the answer looks like on a day like this one. The boundary between what a practice does and what the authorised firm does is set out in who does what.

What is not yet known

Two things about this administration remain open. The FCA states that the joint administrators will work with the FSCS to decide next steps and will provide further updates, so whether and on what basis FSCS protection is engaged for EGR Wealth clients has not been settled and no date has been given for it. Separately, the FCA has not published a further statement about the outcome of the voluntary requirement agreed on 24 July 2026 or its relationship to the administration a month later. Anyone tracking this should watch the FCA news story, which the FCA updates in place, rather than assume the position stated on 26 August is final.

The wider point about a shrinking market

Firm failure is not the everyday risk in financial planning, but consolidation is a permanent feature of it. The lang cat’s State of Advice Report 2025 counted fewer than 5,000 IFA firms in the UK, serving a population in which just 9% of adults had paid for financial advice in the preceding two years — while 91% of those who did take advice found it valuable. A market that small and that concentrated is one in which the firm a client is introduced to today may be part of a different firm in three years, whether through sale, merger or failure.

That is an argument for asking better questions at the point of introduction rather than for making fewer introductions. The gap between how few people receive advice and how many value it, set out in more detail on the advice gap, is not closed by professionals becoming more reluctant to point clients towards help. It is closed by the introduction being made carefully, recorded properly, and made to a firm whose structure the introducer has actually asked about. Weeks like this one are the reason the second half of that sentence matters.

Common questions