The regulator says it uncovered serious failings in the firm’s pension transfer, pension annuity and income- withdrawal business that led to misselling.
Up to 800 customers may have received unsuitable advice in relation to 1,200 sales between February 2006 and October 2007. Net commission from all such sales was £8.6m during this period.
The FSA found the firm missold some pension transfers and pension annuities by recommending products to customers with adequate provisions or whose risk attitude did not match the products that were recommended.
The FSA says failings continued after the firm’s weak compliance controls were flagged up by the regulator.
The firm has since restructured senior management and its compliance department and dismissed several advisers and sales managers.
AWD Group chief executive Mike Kirsch says it is too early to speculate on compensation costs but says the sums are expected to be small compared with pension misselling cases of the past.
He says that most of the failings relate to not being able to document or justify why certain higher-priced products were chosen.
Kirsch says: “We very much regret the regulatory lapses that occurred in the past and our new management team has worked very closely with the FSA to correct matters.”