FCA bans five IFA directors from financial services sector

Five directors of financial advice firms have been prohibited from working in financial services by the FCA and fined over £1m, after they caused significant losses to pension customers.

The decisions follow an extensive 300-page judgement issued by the Upper Tribunal in which the five directors unsuccessfully challenged the FCA’s decisions.

The Tribunal found that Andrew Page, Thomas Ward, Aiden Henderson, Robert Ward and Tristan Freer had “failed to act with integrity” having either acted dishonestly or recklessly.

Each had been directors at failed financial advice firms – Financial Page Ltd, Henderson Carter Associates Limited, and Bank House Investment Management Limited – who provided unsuitable advice to over 2,000 customers.

This caused them to place their pensions in high-risk financial products in self-invested personal pensions in which Hennessy Jones, an unauthorised firm, had a significant financial interest. These customers had been referred to them by Hennessy Jones which was also involved in designing the pension advice process used by these firms.

The FCA revealed that this scheme caused significant losses of over £50m to over 2,000 consumers, who have since been compensated by the Financial Services Compensation Scheme (FSCS). As well as the negative impact on consumers, this also affected other financial services firms which have to contribute to the costs of the FSCS.

The Tribunal found that all the five individuals allowed their “instincts and values to be overridden”, the FCA stated.

“No reputable financial adviser should recommend that people put their entire pension savings in high-risk investments,” said FCA executive director of enforcement and market oversight, Mark Steward. “Customers were misled into believing that they would get independent and impartial advice, but their interests were reprehensibly betrayed in this case.

“This case also places firms’ relationships with unauthorised introducers in the spotlight.  All firms should pay heed and scrutinise these relationships to ensure standards of integrity, due diligence and fair treatment of customers are uppermost.”

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