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British bank heavily fined by FCA for giving poor financial advice
| Published: | 31 Mar at 6 PM |
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Santander Bank have been hit with fines totalling £12,4 million by the Financial Conduct Agency for giving bad financial advice to its customers.
After an investigation by the FCA revealed a list of misdemeanors, the high street giant was found to have failed to consider customers’ attitudes to risk when selling their products. In addition, it is also accused of a list of ethical business failures relating to general investment advice given by its salesmen.
According to the FCA’s Director of Enforcement and Financial Crime, Tracey McDermott, consumers thought they were able to trust the bank to help them manage their investments, but were badly let down. Santander has agreed to reviews all investments made, and to compensate clients who were given bad advice.
Santander’s catalogue of failures included not fully explaining risks to investors, giving misleading information about products, failing to give regular reviews as regards the suitability of investments, allowing untrained staff to give financial advice and having lax controls over the quality of advice given. The flaws were uncovered by means of a ‘mystery shopper’ exercise organised by the FCA, and followed by a wealth management services review.
Given the high number of expat investors and savers who have been subject to the same treatment by unregistered salesmen acting in tandem with major insurance companies lurking in offshore havens and controlled by British executives, it’s unfortunate that the increasingly long arm of the FCA doesn’t reach further. During the last year, many expats in a number of countries including Thailand and Spain have been ripped of their retirement nest eggs by commission-hungry FAs with little or no experience in the field.
The majority of insurance and financial companies providing the products and receiving the investments are EU or occasionally UK based, but the victims are unable even to have their complaints noted by the authorities, let alone acted upon. The FCA’s warnings about bogus advisors acting in the UK might be better focused on the British national bogus advisors working unhindered in the same fields overseas.
After an investigation by the FCA revealed a list of misdemeanors, the high street giant was found to have failed to consider customers’ attitudes to risk when selling their products. In addition, it is also accused of a list of ethical business failures relating to general investment advice given by its salesmen.
According to the FCA’s Director of Enforcement and Financial Crime, Tracey McDermott, consumers thought they were able to trust the bank to help them manage their investments, but were badly let down. Santander has agreed to reviews all investments made, and to compensate clients who were given bad advice.
Santander’s catalogue of failures included not fully explaining risks to investors, giving misleading information about products, failing to give regular reviews as regards the suitability of investments, allowing untrained staff to give financial advice and having lax controls over the quality of advice given. The flaws were uncovered by means of a ‘mystery shopper’ exercise organised by the FCA, and followed by a wealth management services review.
Given the high number of expat investors and savers who have been subject to the same treatment by unregistered salesmen acting in tandem with major insurance companies lurking in offshore havens and controlled by British executives, it’s unfortunate that the increasingly long arm of the FCA doesn’t reach further. During the last year, many expats in a number of countries including Thailand and Spain have been ripped of their retirement nest eggs by commission-hungry FAs with little or no experience in the field.
The majority of insurance and financial companies providing the products and receiving the investments are EU or occasionally UK based, but the victims are unable even to have their complaints noted by the authorities, let alone acted upon. The FCA’s warnings about bogus advisors acting in the UK might be better focused on the British national bogus advisors working unhindered in the same fields overseas.
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