Deloitte & Touche Wealth Management has been hit with the biggest-ever fine for an IFA – £750,000 – for serious compliance failures, including missing pension review deadlines by as much as four-and-a-half years.
The FSA has described DTWM's compliance failings as systemic, continuing over a long period and resulting from a wholly unacceptable approach to compliance by the company until October 2000.
The FSS says inadequate records hampered the firm's ability to carry out its past business review, with DTWM unable to make out from its records whether advice had been suitable or not in 97 per cent of all cases it reviewed.
Current PBR results show 10 per cent of all zero-dividend preference share cases and 7 per cent of all cases sold by one of DTWM's advisers were unsuitable.
FSA director of enforcement Andrew Procter says: “DTWM's failings were so serious that, had it not been for the decisive action taken to improve standards after new management assumed control, we would have considered preventing the firm from conducting investment business.
“Effective compliance procedures are fundamental to consumer protection and are not to be disregarded by a firm's senior management In addition, parent companies, even those not regulated by the FSA, must ensure that they are aware of the actions and behaviour of subsidiaries.”