Overcast

Overcast

max temp: 5°C

min temp: -1°C

Search

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

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.”

0 comments

Welcome , please leave your message below.

Optional - JPG files only
Optional - MP3 files only
Optional - 3GP, AVI, MOV, MPG or WMV files
Comments

Please log in to leave a comment and share your views with other Ipswich Star visitors.

We enable people to post comments with the aim of encouraging open debate.

Only people who register and sign up to our terms and conditions can post comments. These terms and conditions explain our house rules and legal guidelines.

Comments are not edited by Ipswich Star staff prior to publication but may be automatically filtered.

If you have a complaint about a comment please contact us by clicking on the Report This Comment button next to the comment.

Not a member yet?

Register to create your own unique Ipswich Star account for free.

Signing up is free, quick and easy and offers you the chance to add comments, personalise the site with local information picked just for you, and more.

Sign up now

A criminal investigation has been launched by police into a failing care home in Hadleigh at which a resident died.

A crewman has died after a boiler backfired in the engine room of the Manhattan Bridge container ship as it was docking at Felixstowe port last night – causing an “explosion”.

A lorry has burst into flames following a crash with a car on the A14 westbound in Suffolk close to Needham Market.

Urgent improvements have been demanded of three food businesses in east Suffolk, according to hygiene inspection reports.

Animal welfare charities in Suffolk have urged caution over who found pets are given to after reports of a woman in Ipswich posing as an animal welfare officer to obtain a cat found by a homeowner in their garden.

Today the sun is taking the edge off the biting January winds in Suffolk, the perfect winter’s day.

More than half the homes in Suffolk are in the bottom two council tax bands it has emerged.

A Suffolk man has been evicted from his hospital bed by court order after he “unnecessarily” refused to leave for more than two years.

Beach huts, morning runs and golden sand. Not exactly the Felixstowe you might be expecting in January.

Labour’s shadow trade and industry secretary Clive Lewis has visited Ipswich to encourage party members as thoughts start to turn towards this year’s election.

Most read

HOT JOBS

Show Job Lists

Topic pages

Streetlife

Newsletter Sign Up

MyDate24 MyPhotos24