IFA director fined by FSA

The FSA has fined a director of Gloucestershire-based IFA network, Financial Ltd, £49,000 for management failings resulting in poor compliance monitoring on pension switching advice.

The regulator took action against Charles Palmer, director of IFA network Financial Ltd, for the failings which resulted in poor compliance monitoring on pension-switching advice during a period of rapid expansion. The FSA said there were shortcomings in the way the firm organised its business and how responsibility for monitoring advisers was allocated to senior management.

The fine takes into account changes director Charles Palmer made to the firm's governance and compliance monitoring arrangements since December 2007. Because he co-operated fully with the FSA and agreed to settle at an early stage of the FSA's investigation, he qualified for a 30% reduction in penalty.  "This is the second enforcement action we have taken following the FSA's review of pension switching advice,” said Margaret Cole, director of enforcement and financial crime for the FSA.  

"As the director of the firm, Mr Palmer was personally accountable for failing to take the steps needed to manage the risk of advisers giving potentially unsuitable advice during a period when the IFA network was expanding so rapidly. Mr Palmer's realisation of the need to improve the firm's governance and monitoring arrangements, reinforced by the FSA's intervention, mean the risk to consumers has now been greatly reduced."

Financial Ltd has agreed to carry out a review of past business and will pay redress if unsuitable advice was given.