The FSA today censured Integrity Financial Solutions for advice failings relating to the sale and promotion of geared traded endowment policies (GTEPs).
The regulator says Integrity failed as both an IFA practice and product provider but, as the business is in voluntary liquidation, it has not imposed what would have been a £350,000 fine.
As an IFA, Integrity failed to communicate adequately why a GTEP was suitable for customers and the risks associated with it. It also failed to demonstrate GTEPs were the most appropriate products for the clients.
As a provider, the firm failed to ensure promotional material explained the product clearly, which subsequently impacted on its IFAs' abilities to advise on the product.
The FSA has instructed the liquidator to write to Integrity's GTEP to advise them they may have received unsuitable advice and could be entitled to a make a claim for compensation.
"GTEPs are complex products with significant risks attached to them," FSA director of enforcement and financial crime Margaret Coles says.
"Integrity should have made these risks clear to investors, but it did not; neither did it ensure that the promotional material given to IFAs selling its product described the risks sufficiently."
Integrity is the third business the FSA has taken action against over GTEPs. In 2008, it fined Knowlden Titlow Financial Services and Derrick Hales Financial Planning Ltd for failures relating to the sale of GTEPs.
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