Wealth management firm Helm Godfrey is under investigation by the Financial Conduct Authority (FCA) for advice it gave on unregulated collective investment schemes (UCIS).
The regulator has asked the firm to carry out a skilled persons, or section 166, review - a third person review paid for by the firm - to check whether it had given poor advice on UCIS sales between 2007 and 2010.
The firm declined to comment on which advisers or investment schemes were involved in the review but said it had "made major amendments to its processes around the sale of UCIS to clients since the period in question".
The firm said it was co-operating "fully and openly" with the skilled person and the regulator in every way.
Helm Godfrey chief executive Graham Cross said: "We deeply regret any lapse in standards of compliance with the rules about sales of UCIS. We have thoroughly revised our processes and systems in the three years since the issue became apparent and our due diligence is now among the most robust in the advisory marketplace.
"Helm Godfrey has an excellent record of looking after it clients and we are able and willing to make good any customer detriment that is identified. We believe the business is strongly placed to succeed in the post-RDR environment."
Chairman of Helm Godfrey Danby Bloch added: "We are continuing to investigate whether under our former UCIS advice process any unsuitable investments were made or losses to client portfolios have resulted from the UCIS sales in question. If this were to be established, then suitable redress would be made."
The FCA banned the sale of UCIS to retail investors in a policy statement in June this year after it found that the risky products were not suitable for ordinary investors.
The regulator restricted their sale to sophisticated investors and high net worth individuals instead.
UCIS are pooled investments in often high-risk, esoteric assets. Investors that put money into them have no recourse the Financial Services Compensation Scheme (FSCS) if the firm they invested with defaults.
The FCA is said to have become worried about advice on UCIS after carrying out an initial audit survey among IFA firms pre-Retail Distribution Review.
It had found "numerous errors and omissions in the use of UCIS" during its survey according to threesixty services head of client relationships Tony Bray.
The regulator had surveyed 12 firms and found every one of them was not recommending UCIS in an appropriate manner, according to Bray.
This resulted in 11 of the firms voluntarily varying their permissions, and for a number of them to be issued with a section 166 review, he said.
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