The Financial Conduct Authority (FCA) has taken action against three firms and five individuals that gave unsuitable pension advice and outsourced important functions to unauthorised third parties.
The three firms involved were: Financial Page, Henderson Carter Associates and Bank House Investment Management.
Andrew Page, Thomas Ward, Aiden Henderson, Robert Ward and Tristan Freer were the individual recipients of the decision notices.
All five directors and Bank House IM have referred the FCA’s decision to the Upper Tribunal.
This means that the notices are now provisional and will have no effect until the tribunal has ruled on the different cases.
Misleading customers
The FCA said that the three companies “had little meaningful oversight and involvement in the advice provided to customers in their name”.
“They adopted a pension review and advice process which involved outsourcing important functions to unauthorised third parties.”
But no action was taken against the third-party firms or their directors.
“[The firms] held themselves out to customers as providing bespoke independent investment advice based on a comprehensive and fair analysis of the whole market, but that did not reflect the reality of the service that was provided,” the regulator added.
“In reality, customers were recommended pension switches and pension transfers to products that invested in high risk, illiquid assets which were unlikely to be suitable for them.”
Lying to the FCA
The watchdog claimed that the directors should have known that the products they were offering were mostly unsuitable to retail customers and described them as “reckless”.
Additionally, all five directors “acted dishonestly by providing false and/or misleading information to the FCA, in some cases more than one occasion”.
The misleading information related to the firms’ business arrangements and to the compliance of their advice, parts of which were concealed in the submissions to the FCA.
In total, over 2,000 customers invested approximately £76m ($99m, €88m) of their pension assets.
At the end of January 2019, the Financial Services Compensation Scheme was only able to refund £26.8m to 1,106 customers and is currently investigating the remaining claims.
The sanctions
Financial Page and Henderson Carter Associates got away with only a reprimand from the regulator via public censure.
However, all of the others got either a fine, a ban or both – but since they are appealing the decisions, these are still pending.
- Andrew Page (director of Financial Page) was banned and handed a penalty of £321,033;
- Thomas Ward (unapproved de facto director of Financial Page) was banned and given a fine of £416,558;
- Aiden Henderson (director of Henderson Carter Associates) also received a ban and a £179,179 fine;
- Bank House Investment Management was given a penalty of £311,639;
- Robert Ward (director of Bank House IM) was fined £88,100 and also banned;
- Tristan Freer (director of Bank House IM) was banned and given a fine of £52,725 as well.
All five directors were given prohibition orders, banning them from “performing any function in relation to any regulated activity”, the FCA said.
But the decision notices did not mention the time period the bans would be in effect.
