Some Hartley Pensions Limited clients with ring-fenced funds have been told that transfers from their accounts cannot currently be processed, according to an FCA update published on 3 September 2026.
Hartley Pensions has been in administration since July 2022. The latest development illustrates an important complication when a regulated financial business becomes insolvent. The assets connected with customers do not necessarily have the same legal status as assets belonging beneficially to the insolvent company itself.
For clients, creditors and directors, it is therefore important to establish how particular funds are held, who has legal and beneficial ownership and whether separate regulatory or legal restrictions apply. Administration itself does not automatically determine those questions.
What is the latest position for Hartley Pensions clients?
The FCA confirmed on 3 September 2026 that Hartley Pensions clients whose funds have been ring-fenced have been contacted directly by the joint administrators.
- Those clients have been told that transfers from the affected accounts cannot currently be processed. The joint administrators are in contact with the relevant authorities concerning the position.
- The FCA has also said that clients who have not received the relevant communication are understood not to be affected and that their transfers and other transactions are continuing normally.
This distinction is important. The restriction does not apply to every Hartley Pensions client.
The position concerning the ring-fenced funds has developed over time. Previous FCA updates explained that the administrators were maintaining restrictions while questions surrounding the source and status of particular monies were considered in connection with separate civil litigation.
The September 2026 update does not determine who is ultimately entitled to those funds. Nor does it establish that the funds have been lost.
What happens to client assets when a regulated company enters administration?
Administration is a formal corporate insolvency procedure in England and Wales. Administrators take control of the company’s affairs and must pursue the statutory purpose of the administration.
However, an administrator does not automatically become beneficially entitled to every asset that happens to be held or administered by the company.
The legal treatment of an asset depends on the underlying arrangements.
A regulated financial business may hold money or assets under structures designed to separate client property from its own assets. Pension arrangements may involve trustees, custodians and other entities with different legal interests and obligations.
In Hartley’s case, the FCA has previously explained that existing pension assets were held by trustee companies which had not themselves entered insolvency.
That does not mean that every issue concerning those assets disappears when the operating company enters administration. Administrators may still need to determine how particular funds should be treated, especially where questions about their source, ownership or transfer arise.
The underlying administration process is explained further in FWJ’s company administration guide.
Why can administrators ring-fence particular funds?
Ring-fencing particular funds can allow administrators to preserve the existing position while questions about ownership, entitlement or competing claims are resolved.
It should not automatically be interpreted as a finding that the money belongs to one particular party.
The background to the Hartley restriction demonstrates why that distinction matters.
- Previous FCA updates referred to unauthorised movements of money from certain SIPPs and stated that the relevant sums had subsequently been repaid before the administration.
- The administrators maintained restrictions while the source of money used for those repayments was considered in connection with civil litigation in the Isle of Man.
The current FCA update says that transfers from the affected accounts cannot presently be processed. It does not announce a final decision concerning entitlement to those funds.
Administrators dealing with disputed or potentially competing claims to assets may therefore need to act cautiously. Making a distribution or permitting a transfer before the legal position is established could create further difficulties if another party later establishes an entitlement to the same property.
For insolvency practitioners dealing with difficult questions arising during an appointment, FWJ also advises on the legal issues arising during company administrations.
How do the FCA and administrators work alongside each other?
The administration of an FCA-authorised business can involve both insolvency law and financial regulation.
Administrators are insolvency office-holders with responsibilities under the statutory administration framework. The FCA has a different role as the financial services regulator.
Those functions can operate alongside each other.
In Hartley’s case, the FCA states that it remains in regular contact with the joint administrators and other relevant parties concerning affected consumers.
There is also a separate FCA enforcement process.
In April 2026, the FCA announced that it had issued Warning Notices concerning Hartley Pensions and an individual associated with the business. The FCA alleges that substantial amounts of customers’ pension funds were improperly withdrawn and invested without their consent and that false or misleading information was provided to the regulator.
Those remain allegations rather than final regulatory findings.
The FCA expressly states that Warning Notices are not final decisions. The parties concerned have rights to make representations and, if a Decision Notice is eventually issued, there may be a right to refer the matter to the Upper Tribunal.
The FCA’s September update confirms that this separate enforcement case remains unchanged from the position announced in April 2026.
This illustrates why the different processes need to be kept separate. An administrator may be determining the treatment of assets while a regulator separately investigates conduct. One process does not automatically determine the outcome of the other.
What should directors and stakeholders take from the Hartley Pensions administration?
The Hartley administration involves unusual facts, regulated pension arrangements and ongoing issues concerning particular funds. It should not be treated as a template for every company administration.
It does, however, demonstrate why identifying the legal status of assets can be critical at the outset of an insolvency.
For directors of regulated businesses, financial difficulty can create several overlapping responsibilities. Decisions taken before an administration may later be examined by administrators and regulators, particularly where client assets, restricted funds or regulatory requirements are involved.
Directors can protect their position by ensuring that company and client assets are properly identified, maintaining accurate records of how money is held and transferred, documenting significant decisions and obtaining appropriate professional advice where the position is uncertain.
An administration or regulatory investigation does not itself establish wrongdoing. However, clear records can become particularly important where administrators later need to reconstruct transactions or determine whether particular assets belong to the company, clients or another party.
Creditors also need to understand that an administration does not necessarily mean that every asset associated with the business will form part of the pool available for distribution. Ownership, security, trusts and other legal arrangements can materially affect what the administrator is entitled to realise.
FWJ advises directors, creditors and insolvency practitioners on company administrations and disputes arising during formal insolvency proceedings throughout England and Wales.
