The former LIA president was fined for failing to ensure Park Row advisers properly evidenced the suitability of sales.
Sprung, who championed professionalism for advisers, gave the FSA an undertaking he would not take on any significant influence functions for five years.
The PFS is investigating the issue and may schedule a disciplinary hearing while the IFP is set to discuss potential sanctions at an ethics, standards and disciplinary committee meeting next week. A Chartered Insurance Institute spokeswoman says: “We are making enquiries in relation to compliance issues associated with the code of ethics. Should breaches be found, appropriate action will be taken.”
IFP chief executive Nick Cann says: “We will definitely be reviewing his membership in light of the information we have.”
Between January 1, 2007 and January 20, 2009, the FSA said Sprung’s conduct fell short of its prescribed regulatory standards for approved persons as he failed to take reasonable steps to ensure Park Row complied with FSA requirements.
The fine related to pension advice, advisers providing advice without authorisation, the risk of selecting products based on higher commission, failure to ensure systems and controls were adequate to manage risk and failure to ensure suitability of advice through compliance checks.
Sprung failed to ensure advisers gathered and retained sufficient information and did not recognise the problems were systemic. The FSA said
Sprung was made aware of deficiencies in systems and the potential risks to consumers on several occasions but his action was insufficient.