The FSA has publicly censured Integrity Financial Solutions for failings in its role as a product provider and adviser of geared traded endowment policies.
Integrity is in voluntary liquidation, so the FSA has instruc-ted the liquidator to write to the GTEP customers of the firm’s IFA practice, informing them they may have received unsuitable advice and could be entitled to make a claim.
Last month, Integrity’s liquidators warned that claims against the firm could reach £80m. A Freedom of Information request by Money Marketing last week revealed that the firm falls in the intermediation sub-class of the Financial Services Compensation Scheme.
The FSA has waived the £350,000 fine it would have imposed so that any remaining money can be used to meet customer claims.
Integrity was a provider of GTEPs but also advised on the sale of them through its IFA practice. An FSA investigation found serious failings in both areas.
In relation to sales to customers of its IFA practice, the FSA found Integrity failed to communicate adequately why a GTEP was suitable for a customer and the risks associated with it.
In relation to Integrity’s role as a product provider, the firm failed to ensure that promotional material explained the risks of the product clearly.
The investigation follows a thematic review of GTEPs that began in 2007.
Following a visit from the FSA, Integrity carried out a past business review of GTEP sales but did not accept the findings. The FSA subsequently carried out its own review.