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FSA bans adviser over Ucis sales

FSA Front 480

The FSA has banned an adviser for promoting an unregulated collective investment scheme without carrying out proper due diligence.

MNFA director Richard Rhys has been banned from the industry on the grounds he is not a fit and proper person and lacks competence.

Rhys wrongly concluded the scheme he was recommending was not a Ucis and therefore failed to comply with Ucis promotion rules.

Ucis cannot be promoted to the public unless the clients meet specific exemptions, such as if the client can be shown to be a sophisticated investor.

The FSA says: “Rhys incompetently made misleading statements to investors and failed to take any steps to ensure the suitability of advice to customers.”

The regulator has previously said Ucis are rarely suitable for retail investors. The regulator is expected to consult on new rules regarding the sale of Ucis shortly.


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