FSA bans partner at First Colonial Investments LLP for governance failings
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The FSA has banned First Colonial Investments LLP partner Gerald Classey for several failings, including a failure to exercise proper oversight of the stock broking business and not informing the regulator of previous convictions.
FCI operated as an appointed representative of Direct Sharedeal Limited until March 2009 and its sales advisers made telephone sales promoting high risk securities to retail clients. Classey was the only person approved by the FSA in a significant influence function at the firm and the regulator says Classey failed to carry out this responsibility and therefore failed to realise that FCI’s sales practices were deficient.
The regulator found that in addition to using unsuitable sales practices, FCI also failed to deliver shares to client, safeguard client’s money issued unfair and potentially misleading financial promotions and carried out trades after it ceased in its role as appointed representative on March 31, 2009.
It also emerged that Classey had previously been convicted in the USA for two minor offences which he did not disclose in three separate applications to the FSA to become an approved person.
FSA managing director of enforcement and financial crime Margaret Cole says: “Being a partner of a firm carries substantial responsibility for ensuring that the firm meets its regulatory responsibilities. Classey failed to discharge these responsibilities and therefore demonstrated that he is not a fit and proper person.
“We also expect individuals at all levels to be open with the FSA when applying to be an approved person and to disclose any information that may be relevant to their application. Classey’s failure to do so shows that he lacks integrity and is not competent to be an approved person.”
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Readers' comments (1)
Julian Stevens | 29 Sep 2010 5:03 pm
All rather naughty stuff and the action taken by the FSA seems justifiable.
That having said, one wonders just how well the "standards of governance" of a good number of senior people at the FSA might stand up to close investigative scrutiny, given what they allowed to go on in the run up to the banking crisis. Was it corruption or incompetence?
But then what do they care? If they screw up they have a cosy clause in their contracts of employment entitling them to hundreds of thousands of pounds of other peoples' money by way of "compensation for loss of office".
We, the Great Unwashed out here in the real world, have to live by a rather different set of rules.
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