Charles Anthony Llewellen Palmer, also the majority shareholder and CEO of Standard Financial Group, which is the inactive parent company of Financial Limited and Investments Limited, has taken his case to the Upper Tribunal.
The regulator has ruled that between 24 February 2010 and 20 December 2012 Palmer did not take adequate steps to make sure appointed representatives (ARs) and individual advisers who have approval to perform the customer function gave the correct advice to approximately 40,000 customers.
Financial Limited individual advisers and ARs advise customers on pensions, investments including unregulated collective investment schemes, mortgages, general insurance and protection products.
The customer function, or CF30, relates to giving advice on, dealing and arranging deals, and managing investments.
Palmer refuses to accept the Financial Conduct Authority’s (FCA) decision and has referred his case to the Upper Tribunal which will suspend the fine until the case is assessed.
The customer function has to do with giving advice on, dealing and arranging deals in and managing investments
In a separate decision the regulator fined former risk management director at the Standard Financial Group, Paivi Katriina Grigg, £14,807 for failing to ensure the network’s risk management framework was adequate to mitigate risks to the group’s customers.
The FCA found that Grigg failed properly to understand and carry out a number of her specific responsibilities. Grigg’s failures resulted in the group operating under a flawed risk management framework which did not adequately identify and mitigate risks to the group’s customers, causing consumer detriment.
The group’s business model posed an increased risk to customers because it allowed the group’s ARs and approved persons to give investment advice a high degree of flexibility and freedom as to how they could operate within the network. The regulator ruled that her actions put approximately 26,750 customers at risk of poor outcomes, including the risk of receiving unsuitable advice.
In July last year, the regulator restricted Financial Limited from appointing any new ARs or individual advisers to its network for 126 days and issued the network with a fine. The decision prompted NatWest to stop accepting mortgage applications from ARs belonging to the network.
The action taken against Grigg is final as she has not referred her case to the tribunal.