Partly Cloudy

Partly Cloudy

max temp: 4°C

min temp: 1°C

Search

Ipswich: Independent financial adviser welcomes FCA action on ‘misleading’ promotion

PUBLISHED: 09:00 17 June 2014

Peter Herd of Essential IFA staging his protest outside the Chelsea Building Society in Ipswich in 2010.

Peter Herd of Essential IFA staging his protest outside the Chelsea Building Society in Ipswich in 2010.

A Suffolk-based financial adviser who staged a one-man protest in 2010 over what he claimed was an unfair sales promotion has welcomed a move by the Financial Conduct Authority (FCA) to impose fines totalling more than £3.8million.

The FCA said yesterday it was fining Credit Suisse International (CSI) £2.398m for failing to ensure that promotions for its Cliquet Product were clear and not misleading, with the Yorkshire Building Society (YBS), which acted as distributor for the product, also to be fined £1.429m.

According to the FCA, the product was designed to offer capital protection and a guaranteed minimum return but with the “apparaent potential for significantly more” if the FTSE 100 share index performed consistently well.

The authority concluded, however, that the probability of achieving the maximum return was “close to 0%” despite the figure being used as a key feature of the promotion.

Tracey McDermott, the FCA’s director of enforcement and financial crime, said: “Financial promotions are often the primary source of information for consumers and in this case CSI and YBS let their customers down badly. These promotions were a serious breach of the requirement to be clear, fair and not misleading.”

The FCA said that both firms had agreed to settle an an early stage of its investigation and had therefore received a 30% discount on their fines.

News of the fines was welcomed by Peter Herd of Ipswich-based Essential IFA, who staged a demonstration outside the Ipswich branch of the Chelsea Building Society (part of YBS) in November 2010 when the investment scheme in question was being promoted.

“I am very glad that the FCA has taken this matter seriously,” he said. “However, it is no longer just about banks and building societies; there are now online providers offering products without authorisation.

“People need to make sure they seek independent advice and to make sure the organisation or individual is authorised to conduct business and give advice.”

A spokesman for the Yorkshire Building Society Group said yesterday that it fully accepted the FCA decision and apologised to its customers. “We have agreed with the FCA a process under which our affected customers will be given the option to exit their account and receive an appropriate rate of interest, or to retain their account until maturity.

“We will be communicating further information to affected customers (including those who have closed their account), over the coming weeks,” he added.

Credit Suisse also said that it accepted the FCA’s findings, adding: “We have taken this matter very seriously, have fully co-operated with the FCA’s investigation and have agreed a comprehensive redress process.”

Engineers worked through the night to restore power to households across Suffolk and north Essex after the region was battered by winds of over 70mph.

Commuters using Greater Anglia trains in Suffolk and Essex are facing further disruption after the region’s rail network was brought to its knees by yesterday’s storm.

The mother of a selfless Suffolk fundraiser is continuing her daughter’s fight to persuade women and girls to have smear tests in her honour.

An alliance of schools in Ipswich has won £20,000 of funding to boost the quality of teaching in the area through better use of research.

A car has rolled onto its roof following a single vehicle collision on the A12 at Copdock.

A well-known Elvis impersonator from Ipswich has died at the age of 57 following a short battle with cancer.

A Second World War hand grenade has been destroyed in a controlled explosion after being handed in at Felixstowe Police Station by a member of the public.

An mother-of-six can continue keeping pets despite being convicted of mistreating a dog.

An A&E department in Suffolk had to close to ambulances for a temporary period because patient safety was at risk, it has been revealed.

A number of roads and rail lines remain closed in the aftermath of Storm David - here is a rundown of where to avoid on your trip home.

Most read

Show Job Lists

Topic pages

Newsletter Sign Up

Sign up to receive our regular email newsletter
MyDate24 MyPhotos24