The FSA has banned and fined a Sheffield IFA firm £97,600 after it advised 94 clients to invest over £12m in unregulated collective investment schemes.
The regulator found that between May 2004 and June 2010, Topps Rogers Financial Management did not establish clients’ eligibility to invest in Ucis before promoting the investments to them. Under FSA rules, Ucis cannot be promoted to the public unless they meet specific exemptions, such as if the customer can be shown to be a sophisticated investor.
Topps Rogers also failed to adequately assess and establish customers’ attitude to risk, or carry out adequate research to support its recommendations.
Suitability letters were drafted from a template and were not issued for Ucis fund switches and customer files contained no record that customers had been notified of the fees or commission Topps Rogers would receive, or the investment charges payable.
In November, the FSA said it would ban Topps Rogers partner and adviser Martin Rigney from carrying out regulated activity, and sought to fine him £117,330. Rigney has referred this decision to the Upper Tribunal.
The firm voluntarily varied its permissions in May 2009 to stop arranging new Ucis business.
Topps Rogers was put into liquidation in September and Rigney and his wife were declared bankrupt in November last year.
Evolve Financial Planning director Jason Witcombe says: “We treat these schemes with kid gloves. We look to keep our investment proposition simple so there are no nasty surprises for either us or the clients.”