BEWARE Crown Foreign Currency

I have used crown for several years and always enjoyed good exchange rates,but not this time from what i can gather they have gone under and like many people I have lost £500. The client funds are not ring fenced by law another example of the FSA not doing there job so i do not expect to see my money again!

Yes, I saw a report about them on Spotlight South-west earlier this evening. They're definitely not trading anymore.

 I use Xe.com and after this problem asked the question, "There has been a high profile currency house that has become insolvent this week in the UK. Can you tell me if your operations in the UK are regulated by the Financial Services Agency or if you have to register your business with them?"

The reply was:

For XE Trade, payment services in the UK are provided by Payment services provided by Custom House Financial (UK) Limited (Company Number 04380026. Registered Office Address 2nd Floor, 12 Appold Street, London EC2A 2AW, registered in England) is authorised by the Financial Services Authority under the Payment Service Regulations 2009 (register reference 517165) for the provision of payment services.

So, does that mean you are covered by the FSA guarantee or just open to problems as Crown were?

Mark

Good Question Mark. Xe.com, Smartcurrency exchange, Moneycorp, HIFX etc. are all licenced to trade and comply with FSA regulations - but Crown did as well. There is no suggestion that these other companies are likely to go bust and certainly those I have dealt with don't take your money months in advance. However there is a risk because there is no compensation scheme in place should the worst happen.

I guess it is a case of assessing how much you will save, with a slight risk of loosing your money, using a specialist currency converter vs the safe method of using the banks' own exchance service.

This is what HiFX say on their website:

As one of the largest and most established currency specialists in the UK, HiFX works hard to keep your money safe.

Regulatory Information - HiFX PLC is authorised and regulated by the Financial Services Authority under the Payment Services Regulations 2009, registration number 462444, for the provision of payment services. HiFX PLC also a registered MSB with HM Revenue & Customs – registration number 12131222

Online Security - HiFX Online is VeriSign secured. The VeriSign seal is the most recognised trust mark on the internet and helps companies and consumers all over the world to engage in trusted communications and commerce billions of times every day. 97 of the world's 100 largest SSL-using banks and over 93% of Fortune 500 companies use SSL Certificates sold by VeriSign. In addition, VeriSign secures more than one million Web servers worldwide, more than any other Certificate Authority.

Payments & Settlements - HiFX is one of the only currency specialists in the world with direct access to SWIFT. SWIFT is the world's largest payments and settlements network for domestic and international trades. Direct access ensures HiFX clients, benefit from faster payments and enhanced security.

Security of Funds - When buying currency with us your funds are held either in pooled client trust bank accounts or are held at one of our counterparty brokers as cash in transit or collateral to meet our obligations relating to clients’ trades.

Funds can be used to fulfil the contractual obligations of our clients but will never be anywhere other than:

• In the segregated client accounts
• With our banking counterparties (Barclays; Deutsche Bank; Citigroup or Bank of Ireland Wholesale).
• In transit i.e being sent.

We have held our segregated client trust accounts with Barclays for the last twelve years and I can provide you with a letter from Barclays which confirms this relationship.

http://www.hifx.co.uk/personal/guide_to_our_service/your_security.aspx

The only section of concern is security of funds. Does holding them in a "segregated client trust account" make them safe? Does anyone know if Crown operated using a separate client account? I would have thought this would have a been an FSA requirement.

Also "Funds can be used to fulfil the contractual obligations of our clients" is a bit ambiguous. It is not the same as saying your money will only be used to fulfil your contract.

"Payments & Settlements - HiFX is one of the only currency specialists in the world with direct access to SWIFT."

Can someone tell me what "one of the only" means?

Only the lonely?

"Payments & Settlements - HiFX is one of the only currency specialists in the world with direct access to SWIFT."

Can someone tell me what "one of the only" means?

Only the lonely?

This Crown affair just goes to demonstrate that you have to be so careful when making or taking up a recommendation, its only a couple of months since this company was getting rave reviews on here.

I'm sure you are better sticking with the big boys, Moneycorp etc

s

 I used Crown a number of times and was always happy with the service. Has anyone come across one offering a good rate and service for getting cash to take away on holiday. I don't think the rate is that good for around £1,000, now and then with some of the companies mentioned. The post office seemed the best today, surely that can't be righ, although I didn't go as far as placing an order.

Has anyone experience of getting cash out of a Santander cash machine in Spain. I asked in my local branch and was told there would be no charges if I used a Santander machine in Spain. However, their site  indicates a different answer.

Kevin