The Financial Services Authority (FSA) has taken action against Ilford-based non-advisory business Baronworth Investment Services - and its chief executive Colin Jackson - for failing to ensure its direct-offer financial promotions were ‘fair, clear and not misleading'.
Baronworth's financial promotions lacked balance by emphasising the benefits of a proposed investment without giving equal prominence to the risks, the FSA said.
In addition, Baronworth - which operated mainly in the execution-only space - failed to handle its complaints appropriately, a significant proportion of which arose from its financial promotions of the Eurolife Secured Bond ISA.
Jackson was directly responsible for these failures as he was solely responsible for drafting and approving direct offer financial promotions and handling of complaints within Baronworth, the regulator said.
Jackson has received a partial prohibition preventing him from performing any significant influence function other than as or through an appointed representative.
The FSA had sought to impose a financial penalty of £50,000 on the firm, but as Baronworth entered into liquidation on 17 July 2012 this was reduced to nil so that any funds could be returned to creditors.
Bill Sillett, head of retail enforcement, said:"This particular case emphasises the need for authorised firms and approved persons to ensure that their financial promotions are clear, fair and not misleading, especially when they are carried out on a direct offer or non-advised basis.
"This is particularly important to ensure non advisory firms are compliant with the recent changes brought in by the Retail Distribution Review".
Taking the time to look
After 14-month FAS programme
More than half of people over the age of 55 see financial security as a top priority in retirement, yet a third allocate more time to buying a new car, research from Legal & General (L&G) has found.
Rebranded from OMW
Number of benefits