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FSA fines IFA firm for compliance breaches

The Financial Services Authority has fined Langtons IFA Limited £63,000 for failing to properly apportion roles and responsibilities to its senior management.

The firm is also accused of not having systems in place to ensure that its advisers were trained and competent. As a result of these failings, customers were potentially put at risk, the FSA says.

Between January 2003 and November 2005, Langtons failed to allocate responsibilities among its senior management effectively. The FSA adds that the resulting confusion over senior management roles meant that its systems and controls were inadequate and its business was not compliant.

Langtons failed to determine the training needs of its investment advisers. When training was undertaken it was not properly evaluated or recorded. Langtons did not assess the continuing competence of its advisers or ensure that those under supervision were being adequately monitored.

By agreeing to settle at an early stage of the investigation Langtons qualified for a 30 per cent discount in its fine, without which the penalty would have been £90,000.

FSA director of enforcement Margaret Cole says: “Langtons’ senior management could not show that they understood or even knew their responsibilities as a regulated business and thereby the firm unnecessarily exposed its consumers to potential risk.

“Responsibility for proper systems and controls and for compliance with rules designed to protect consumers ultimately lies with a firm’s senior management, and we expect them to take these responsibilities seriously.”

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