A2O duo fined £42,000 over compliance failures to take control of risky Ucis advice
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The FSA has fined two former Alpha to Omega directors a total of £42,000 for widespread compliance failings, including failing to adequately monitor unregulated collective investment scheme advice.
A2O compliance director Andrew Ruff, who worked at A2O from March 2007 to December 2009, has been fined £28,000 and banned from performing any significant influence functions.
A2O managing director Richard Lindley, who was at the network from January 2008 until it was placed into administration in January 2010, has been fined £14,000.
In January 2010, the FSA suspended A2O from carrying out all regulated activities over compliance concerns.
The FSA reviewed customer files of an A2O appointed representative in March 2009, after which A2O was required to appoint a skilled person to review the network’s compliance systems. The skilled person failed 98 per cent of the files reviewed. A2O’s records show it passed 99 per cent of the files it reviewed as compliant.
In its final notice against Ruff, the FSA says he was aware of a group of advisers at A2O who were recommending a significant amount of Ucis and other high-risk products. The FSA notice says some of these advisers were so notorious within A2O that they were given nicknames such as “the famous five” and “the three amigos”. Ruff failed to take any effective sanction or control these advisers.
Ruff and Lindley were fined because they failed to effectively monitor and control sales made by ARs and failed to ensure systems and control weaknesses were addressed.
Former A2O adviser Jeremy Marsh says: “I would have expected Ruff to be banned from any kind of control function and I feel the fines against Ruff and Lindley are on the low side.”
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