The Financial Conduct Authority (FCA) has cancelled the part 4A permissions of Cardiff-based Ron Treherne IFA Ltd.
Part 4A of the Financial Services and Markets Act 2000 is the “permission to carry on regulated activities”, the FCA said.
The final notice comes after Ron Treherne IFA failed to comply with two Financial Ombudsman Service (FOS) awards and also failed to demonstrate that the firm has valid professional indemnity (PI) insurance, the watchdog added.
The FCA previously issued a decision notice on 21 April 2021 to notify the firm that the regulator had decided to cancel Ron Treherne IFA’s part 4A permission.
Ron Treherne IFA did not refer the matter to the tribunal within 28 days, resulting in the cancellation of its permission.
International Adviser reported in November 2019 that Ron Treherne IFA was declared in default by the Financial Services Compensation Scheme (FSCS).
First Fos complaint
In the final notice, the FCA said that Ron Treherne IFA was involved in a couple of FOS judgments.
Consumer 1’s complaint to the FOS related to the advice he received from Ron Treherne IFA to transfer his existing pension into a self-invested personal pension (Sipp), to mainly invest in a single unnamed firm.
The client claimed Treherne did not adequately assess the suitability of the investment in the unnamed firm, and that he should not have been advised to transfer his pension into a Sipp.
The FOS award instructed Treherne to calculate fair compensation by comparing the value of consumer 1’s original pension pot, had he not transferred, with the current value of his Sipp.
On 10 April 2018, consumer 1 accepted the FOS award, at which stage the decision became binding. Treherne did not seek a judicial review of the outcome.
but the FCA said that the IFA firm “failed to comply”, despite repeated requests by the FOS and the UK regulator to do so.
Second Fos complaint
Consumer 2’s complaint mirrored that of consumer 1 and related to advice he received to transfer his existing pension into a Sipp to mainly invest in a second unnamed company.
The FOS instructed Treherne to pay consumer 2 a lump sum of just over £132,124 ($187,457, €152,922).
On 5 April 2018, consumer 2 accepted the FOS award. Again, Treherne did not seek a review.
But the firm again failed to comply, despite repeated requests by the ombudsman and the FCA to do so.
PI cover
The FCA added that Ron Treherne IFA “failed to demonstrate that it has valid” PI cover.
The UK regulator said it “has given Treherne ample opportunity to provide evidence that it holds valid PI insurance cover, but has not received any such evidence”.
The firm informed the FCA by email on 8 February 2019 that Ronald Treherne had been retired for five months and no longer practiced as an IFA, and was intending to apply for cancellation of the firm’s part 4A permission.
“However, to date no such application to cancel Treherne’s authorisation has been received by the authority,” the FCA said. “This suggests that Treherne is not intending to obtain PI insurance cover.”
Also, on 26 June 2019, the IFA firm entered into a voluntary application for an imposition of requirement (Vreq) with the FCA, which prevented Ron Treherne IFA from advising on investments, advising on P2P agreements, arranging deals in investments business and making arrangements for investment business.
Appropriate manner
The FCA said that the firm “has failed to satisfy the authority that it is conducting its affairs in an appropriate manner, having regard in particular to the interests of consumers”.
Specifically, it “has failed to comply with the FOS awards made against it, despite repeated requests” and with the lack of evidence on PI cover, it “therefore appears to be failing to satisfy the appropriate resources threshold condition”.
This has led the FCA to consider that the firm’s part 4A permissions “should be cancelled”.
