Four men have been banned from working in financial services over their ‘disgraceful' behaviour in relation to occupational pensions advice which saw them net £4m in unnecessary commission.
The Financial Conduct Authority (FCA) said the banned men were associated with two IFAs appointed by CBW Trustees and CBW Pensions Forensics (CBW) to advise six occupational pension schemes.
The regulator said their advice directly led the affected schemes to unnecessarily move around investments - generating millions in unwarranted commission.
Members of the pension schemes could now face lower retirement incomes, the FCA said, as the pension assets were put in "potentially unsuitable high-risk investments".
FCA director of enforcement and financial crime Tracey McDermott said: "When it comes to pension funds, people expect their investments to be carefully managed given the potential impact on their retirement income. This makes the behaviour of this quartet particularly disgraceful. The FCA will not hesitate to act where we find inept or dishonest individuals."
The FCA stepped in to investigate the behaviour of individuals approved to offer financial services.
The investigation concluded that Michael Conway and Andrew Powell lacked integrity; while Martin Gwynn and Daniel Conway were incompetent, and incapable of properly discharging their duties.
The FCA said Michael Conway was a director of CBW, but failed to disclose that he stood to gain financially from advice offered to CBW by an IFA - G&G Financial Services (G&G).
It explained in April 2010 he actively influenced the financial advice given by Andrew Powell on behalf of G&G for personal gain, and on one occasion facilitated a sham introducer agreement between G&G and a taxi company to disguise a payment of £56,000. Some £2.1m of the total commission generated by the IFAs was paid to Micheal Conway.
Andrew Powell acted as independent adviser to CBW while employed by G&G. Despite raising concerns about the suitability of the investment, he recommended that the affected pension schemes should invest £8m in a high-risk and illiquid property fund chosen by Michael Conway.
Powell personally benefitted by allowing CBW to influence his advice between March 2010 and April 2010.
Martin Gwynn owned G&G and all its shares. Between March 2007 and September 2010 he failed to seek the necessary authorisation from the FCA's predecessor, the Financial Services Authority, when appointing Andrew Powell as a director, and did not properly monitor the advice Powell offered to the affected pension schemes.
Gwynn also failed to take reasonable steps to investigate payments to Michael Conway and other third parties.
Daniel Conway was a director of Staverton Wealth Management (Staverton), which was partially owned by Michael Conway. Daniel Conway was appointed with no prior experience of advising occupational pension schemes.
Between January 2007 and April 2010, the FCA found he failed to take steps to understand the requirements of his role, or offer independent or suitable advice.
The FCA said it worked closely with The Pension Regulator to take action against the responsible people and track down assets located outside the UK.
The new trustee appointed by TPR has recovered a significant proportion of the relevant funds on behalf of the affected pension schemes.
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