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FSA bans IFA for system and control failings

The FSA has banned Martyn Powsney, the former director of IFA firm Powsney & Co Ltd, from holding positions of significant influence in any FSA authorised firm.  

The regulator says Pownsey failed to put in place systems and controls to ensure that customers received suitable advice and failed to take sufficient remedial action.

Following an initial visit in 2007, the FSA required Powsney to take action to rectify “serious failings” at Powsney & Co Ltd but, despite employing a compliance consultant to assist with the remedial work, he failed to take prompt, adequate action.

A subsequent assessment by the FSA in 2008, as part of its assessment programme for small firms, identified similar concerns to the 2007 visit.

The FSA has concluded that Powsney failed to establish appropriate systems and controls at the firm, demonstrate that the firm was providing suitable financial advice and undertake remedial action required by the FSA.

Powsney & Co Ltd is currently in liquidation and is no longer authorised to conduct regulated business.

FSA head of department, enforcement and financial crime Tom Spender says: “Powsney lacked competence and capability. Even when FSA staff visited the firm in 2007 and 2008 and set remedial action, Powsney failed to implement the required changes.

“It is vital that those running firms have the necessary competence and capability to put systems and controls in place to ensure that suitable advice is given and customers are treated fairly. Individuals who do not have these qualities are a risk to consumers and face being banned.”

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Comments

There are 14 comments at the moment, we would love to hear your opinion too.

  1. The FSA seems to find lots of time to visit IFA’s and ban them for failings, which i have no problem with, however, why can they not find the time to regulate the financial services within the banks.

  2. Julian Stevens 1st April 2010 at 3:30 pm

    Fair enough.

  3. What about the ban….

    Oh, too slow

  4. Pissed Off IFA 1st April 2010 at 3:47 pm

    Hi Julian, what’s fair enough. I wonder if all your bits and pieces are above reproach. What the report fails to state is whether or not Powsney and Company’s clients have been ripped off.

  5. Darren Reynolds 1st April 2010 at 4:45 pm

    After FSA visits, Martin employed a compliance firm to go through his files and assess the need to revisit clients. The review cost a fortune, took an age and found no clients had been given bad advice. He put a second oversight in place and joined True Potential to provide a back office system for his information and speed up response time for infromation. Due to the timescales and poor record keeping he is at fault, but I guarantee he is not a bad IFA.

  6. It does appear that the FSA finds it easier to sanction small IFAs, and it (the FSA) has patently failed to regulate the banks. It is now shutting the stable door after the horse has bolted in terms of looking to regulate products before they come to market. However, on a separate point, will those of us still trading be expected to pick up the tab for Pownsey & Company’s clients through an increased FSCS levy.

    PS. Why are so many bloggers afraid to give their names?

  7. To pissed of IFA – which report fails to say whether the clients were ripped off? The Money Marketing report, or the 9 page final notice on the FSA’s website (which presumably you’ve read)?

    Is this the standard of advice you give your clients? It doesn’t matter whether they receive suitable advice, just whether or not they wee ripped off? I suspect you are going to be forced to leave a job you love and have done for 20 years in 2012 because you are too old to do exams, etc etc

  8. Robert Rice, you don’t seem to appear on the FSA register?

  9. It is obvious that the FSA have a directive to rid the industry of the small IFA. Pownsey and Co seemed to be trying to find a remedy from other comments. I have learnt through a few ex colleagues in the Banking industry that mal-practice is rife and the pressures placed on staff to meet targets is taking a toll on their health.

  10. To Robert Rice –

    Off topic, but that’s an ageist comment!

    Not appreciated!

  11. Richard Brydon 4th April 2010 at 1:15 pm

    Methinks that the FSA, or someone representing them, didn’t like the firm or perhaps didn’t like the attitude of the man running the business.

    You cannot willy nilly start reopening files at the behest of the FSA as your PI cover will be no more. So, once again, it’s heads they win and tails you lose.

  12. Another triumph for the FSA. How fortunate the major providers are to have all intermediaries driven out of business. The majority of the public will only have their high street bank to go to for help soon- lucky banks, poor customers who will be ripped off like never before.

  13. The FSA is clearly not fit for purpose when it comes to regulating the provision of financial advice. .

    They are deliberately unclear about the systems and controls needed. This is loading the industry with millions of pounds of extra costs which the end consumer pay for in the form of higher fees or being excluded altogether from receiving advice.

    Its clear that the industry could be vastly better regulated, and that it could be done much more efficiently.

    There are some people who need to be weeded out. However the FSA appears to allow people to either get away with a verbal warning shutting a firm down. There needs to be more of a range of punishments available.

  14. typical adviser response, the sensible ones who aplaud the bad apples getting weeded out the system and the ones who are probably one of the bad apples waiting for the chop. always complaining we need a cheaper better regulator. moan moan moan.

    this should have been a good sucess story for the indusry, crap adviser found out and instead its bandwagon jumping with any personal agenda……for shame on you… for shame

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