The FSA has fined an adviser firm for failing to maintain adequate capital and for providing misleading information to the regulator.
Blake Independent Financial Services Limited (BIFS) has been fined £31,500 for offences between October 2003 and July 2007.
An FSA investigation found the firm had failed to maintain adequate financial resources from its date of authorisation on 29 October 2003.
The firm did not put in place subordinated loans - which rank after other debts should a firm fail - required by the FSA to meet capital resources requirements. In 2005, the firm did not put a further subordinated loan in place to rectify its capital resources shortfall.
The firm also submitted returns to the FSA which indicated it had the required loans in place.
BIFS has since taken action to mitigate the failings, has rectified its capital resources problem and has appointed a compliance consultancy and accountant to advise the firm on its subordinated loan requirements.
Jonathan Phelan, head of retail enforcement at the FSA, comments: “The fine sends out a clear warning to the industry that the way in which firms conduct their business and the way they interact with the FSA are as important as ensuring that individual rules are not breached.”
The original fine of £45,000 was subject to a 30% reduction as BIFS agreed to settle at an early stage in the FSA’s investigation.
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