Two former executives at UK financial advice firms have pleaded guilty to defrauding four clients of £2 million, the Financial Conduct Authority (FCA) announced. Kerry Nelson and Jacqueline Stephens admitted the charges at Portsmouth Crown Court, marking a significant step in a criminal prosecution that began in 2025.
Kerry Nelson, who was director of Nexus Independent Financial Advisers and Nexus Investment Managers, pleaded guilty to fraud by abuse of position and an additional money laundering offence. Jacqueline Stephens, who worked as business operations manager at the firms, pleaded guilty to fraud-related charges. The fraudulent activity occurred between January 2019 and January 2023, with the defendants using false documentation to deceive clients.
The FCA stated that Nelson used funds withdrawn from the firms to fund an extravagant lifestyle. The regulator intends to pursue confiscation proceedings under the Proceeds of Crime Act to deprive Nelson of any financial benefit from the criminal conduct. Sentencing is scheduled for December 10, 2026 at Portsmouth Crown Court.
The case highlights a critical regulatory distinction: neither Nexus firm had permission to hold or control client money, despite Nexus IFA holding permissions to advise on investments, mortgages and pensions, and Nexus IM holding discretionary management permissions. This means clients may have assumed their funds were protected when in fact the firms lacked authorisation for custody.
In January 2023, the FCA restricted both businesses from conducting regulated activity and from reducing the value of assets they held. The High Court placed the firms into administration the following day. The legal framework includes charges under the Fraud Act 2006, the Forgery and Counterfeiting Act 1981, and the Proceeds of Crime Act 2002.
The FCA's broader enforcement policy includes pursuing confiscation in a separate crypto fraud case, where recovered funds are being returned to victims. However, this particular case involves traditional financial advisory services and does not directly involve cryptocurrency assets or platforms.
