IFA network Sesame has said it remains in a 'strong' financial position and will not increase its membership fees because of today's £6m fine for failings relating to advice given on Keydata products.
The group was fined £6,031,200 in total after failing to ensure that investment advice given to its customers was suitable.
The penalty is made up of a £245,000 fine for Sesame's advice failings in relation to Keydata life settlement products, and a £5,786,200 fine for systems and controls weaknesses across its investment advice business.
The fine more than wipes out the £4m trading profit the business made in 2012, but despite this, the group said it still had a strong capital position and had accounted for much of the fine already.
"Sesame Bankhall Group has a strong capital position that has been built up over many years and is able to deal with these issues, while continuing to develop and grow its business in the future," it said in a statement sent to IFaonline's sister titel Investment Week.
"We have been working with the FCA towards today's announcement for over a year and we have already accounted for a large proportion of the costs. It will not impact on Sesame Limited's strong trading position."
The group added it was not planning to increase its membership fees as a result of the fine.
A spokesperson said: "We are not planning to make any changes to members' charges as a result of this announcement. The price review process has been an annual forward looking activity for a number of years in order to ensure the cost of engagement is aligned to the ever increasing operational and regulatory costs of running an advisory business."
The FCA rated failings at Sesame to be a level three in terms of seriousness, it said today.
This means the fine it imposed was worth 10% of the group's £83m revenue from investment business it carried out between July 2010 and September 2012 before a discount was applied, according to the FCA Final Notice published today.
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