FCA: Two plead guilty after clients lose £2m in fraud case

• The fraud involved false documents and occurred between January 2019 and January 2023.
• Confiscation proceedings will be pursued under the Proceeds of Crime Act 2002.

Kerry Nelson and Jacqueline Stephens, who worked at Nexus Independent Financial Advisers Limited and Nexus Investment Managers Limited, admitted to defrauding clients and using false documents, resulting in £2m in losses for 4 clients. Nelson also admitted to a money laundering offence after withdrawing money from the firms for personal use.

The FCA started criminal proceedings in February 2025, and both individuals pleaded guilty at Portsmouth Crown Court on 12 October 2026. The FCA imposed restrictions on the firms in January 2023, and the High Court placed them into administration the following day.

• £2m client losses
• 4 clients affected

• Review client relationships with Nexus Independent Financial Advisers Limited and Nexus Investment Managers Limited for exposure to fraud risks.
• Check for any transactions involving false documents or unauthorised withdrawals between January 2019 and January 2023.
• Monitor updates on confiscation proceedings under the Proceeds of Crime Act 2002 related to Kerry Nelson.

This case highlights the risks of internal fraud and abuse of position within FCA-authorised firms, especially where individuals use false documents and circumvent controls. The fact that neither firm was permitted to hold or control client money, yet significant losses occurred, underscores the importance of robust oversight and segregation of duties. Compliance officers must remain vigilant for red flags, ensure adherence to permissions, and respond promptly to regulatory restrictions or criminal proceedings to protect clients and firm integrity.