The FCA is seeking to ban and fine Financial Ltd chief executive Charlie Palmer £86,691 over failing to ensure appointed representatives gave suitable advice to around 40,000 clients.
Palmer has referred the matter to the Upper Tribunal.
The regulator has also fined former Financial risk management director Paivi Grigg £14,807 for failing to ensure the network’s approach to managing risk was appropriate.
In the decision notice against Palmer, the FCA says Palmer failed to take adequate steps to ensure risks were managed effectively.
The regulator says Financial’s business model allowed ARs and individuals a high level of freedom and flexibility, putting around 40,000 clients at “significant risk” that they would receive unsuitable advice. The regulator says this includes high risk products such as unregulated collective investment schemes.
The FCA says as a result it is looking to fine Palmer £86,691, as well as banning him from holding senior management roles in regulated financial services.
Palmer has previously been investigated by the FSA in 2009 and fined £49,000 by the regulator in 2010 over the risk of unsuitable pension switching advice.
A past business review into pension switching at Financial is ongoing and being carried out by parent company Tavistock Financial, which acquired the Financial network in February.
In July 2014 the FCA estimated that 80 per cent of Financial Ltd’s Ucis customers may have received unsuitable advice after finding “systemic weaknesses” in the network’s systems and controls.