The FSA has issued a public censure of City Gate Money Managers Limited and banned its director and compliance officer Stewart Wallace Domke from holding any significant influence functions.
The FSA would have imposed financial penalties of £180,000 on City Gate and £70,000 on Domke. However, City Gate is in liquidation and is unable to pay a fine, while Domke has provided evidence to show that a fine would cause him serious financial hardship.
The FSA says City Gate advised on pension transfer and income drawdown business when it did not have permission to do so.
It also produced a financial promotion that did not comply with FSA rules and failed to have adequate systems and controls in place to monitor and oversee its advisers and appointed representatives.
In July 2009, the FSA fined City Gate £42,000 for systems and controls failings around the approval of financial promotions and inadequate monitoring of appointed representatives.
The FSA found Domke failed to address the failures identified by the FSA’s first action and ensure the firm only performed the regulated activities for which it was authorised.
He also failed to ensure a financial promotion complied with FSA rules and delegated compliance functions to others but failed to oversee their work, resulting in serious compliance failures.
FSA head of retail enforcement Bill Sillett says: “It is rare that the FSA has to take action against a firm more than once but City Gate’s systems and controls remained poor despite our first enforcement action.”