Private investors with shares frozen in accounts at Pacific Continental face a further wait before they learn if they’ll get their holdings back.

Creditors in the company met yesterday (31 October) to approve plans to liquidate the company. Administrators at Smith & Williamson had hoped to have worked out individual holdings in nominee accounts before the meeting.

But in a report to creditors, administrator Stephen Cork said the reconciliation of investors’ shareholdings ‘will take some time to complete.’ If customers’ shares can’t be found they will become creditors.

Like other creditors, they will have an equal claim on any proceeds of the liquidation. But even then there is no guarantee that any money will be left over, said Cork: ‘I am unable to say with any certainty what level of distribution may be made to any unsecured creditors.’

In his report to creditors Cork revealed the circumstance leading up to the broker going into administration on 20 June. There were so many Financial Ombudsman Service (FOS) claims against Pacific its auditors reckoned it would need more than £2 million to cover them.

At this point the Financial Services Authority (FSA) stepped in and demanded an immediate £2 million cash injection – the money could not be found. If proceeds from the liquidation are unable to cover claims from investors with lost holdings they will be able to take their claims to the Financial Services Compensation Scheme (FSCS).