Corporate bonds assets that back WiseAlpha Fractional Bonds are ring-fenced in WiseAlpha plc which is a bankruptcy remote investment vehicle (similar in concept to a fund vehicle). The assets (corporate bonds) perfectly match its liabilities (Fractional Bonds issued to our clients).
WiseAlpha utilises the services of global banking custodian, BNY Mellon to hold the corporate bonds. Independent oversight is provided by IQEQ, the fourth largest investor services firm in the world. Its costs are minimal and are supported by the fees generated by the WiseAlpha platform and hence the risk of insolvency is negligible.
The day-to-day operational costs are borne by WiseAlpha Technologies Limited, which operates the website. It is authorised and regulated by the FCA. It is required to maintain a minimum level of capital to operate on an ongoing basis and must report to the FCA.
In the event that WiseAlpha Technologies' capital falls below the level required to operate all clients’ cash balances and investments in Fractional Bonds would not be affected and would continue to be administered within WiseAlpha plc and the client account continue to be run by Global Custodial Services.
The web platform that is operated by WiseAlpha Technologies will be handed over to an administrator with all client data and records held intact in order to keep website transactional capability for investors intact and minimize any customer service disruption.
This structure ensures a separation of investor money (held and invested at WiseAlpha plc) from the main operating company (WiseAlpha Technologies Limited).
Read more about the specific risks of investing with WiseAlpha here.