Mr Adrian Douglas, Mr Liam Martin and Mr Frank Oxberry have each referred their Decision Notices to the Upper Tribunal. The findings outlined in the Decision Notices given to them reflect the FCA’s belief as to what occurred and how it considers their conduct should be characterised. The proposed action outlined in their Decision Notices will have no effect pending the determination of the references by the Tribunal whose decision will be made public on its website.
The Tribunal will determine, in the case of the decision to impose a financial penalty what (if any) the appropriate action is for the FCA to take, and remit the matter to the FCA with such directions as the Tribunal considers appropriate and, in relation to the decision to make prohibition orders or a decision to withdraw approval, whether to dismiss the reference or remit it to the FCA with a direction to reconsider and reach a decision in accordance with the findings of the Tribunal.
Mr Alec Cuthbert agreed to settle the FCA’s case against him and therefore has not made a reference to the Tribunal of our decision to take action. The Final Notice given to him has not been the subject of any judicial finding. It includes criticisms of Mr Oxberry who has been given a Decision Notice in relation to the same matter. As above, Mr Oxberry disputes his Decision Notice and has referred it to the Upper Tribunal for determination.
The Financial Conduct Authority (FCA) has decided to ban two financial advisers and two partners at St Martin’s Partners LLP (SMP) from working in financial services, and collectively fine them £590,544. The regulator considers the four were responsible for a pension transfer advice model that put at risk people’s guaranteed retirement benefits.
Between October 2015 and July 2016, SMP’s advice model put 547 customers at significant risk of transferring out of guaranteed defined benefit pensions into investments which were unlikely to be suitable for them, including investments in hotel developments in Cape Verde offered by The Resort Group Plc.
Many of those customers were brought to SMP by ‘introducer’ firms, including First Review Pension Services Ltd (FRPS), a subsidiary of The Resort Group. In the FCA’s view, SMP had clear indications of the link between FRPS and The Resort Group.
SMP’s advice model did not take into account the information required to assess the suitability of a pension transfer or how the benefits of the customer’s existing scheme compared to the new investment. SMP did not intend it to.
Adrian Douglas and Liam Martin, both qualified pension advisers, played important roles in designing and operating the transfer advice model used at the Essex-based firm.
SMP’s two partners, Mr Oxberry and Mr Cuthbert, had oversight of the firm and its advisers. They did not ensure that due diligence was carried out on either FRPS or at least 16 other introducer firms involved in the model.
A requirement was agreed in November 2016 that stopped SMP using the advice model.
Therese Chambers, Joint Executive Director of Enforcement and Market Oversight, said:
“People need to be able to trust the advice they receive about their pensions. But these four individuals put SMP’s customers in danger of giving up guaranteed retirement income for high-risk investments, like overseas hotel developments. They received significant financial benefit in doing so, at the expense of their customers.
“There was a reckless disregard for customers’ financial situation, their needs through retirement and how their existing benefits compared to the proposed alternative. It is right the FCA takes steps to prevent these people from working in the financial industry and impose penalties.”
The FCA has decided to fine Mr Oxberry £241,869, Mr Martin £128,356 and Mr Douglas £128,356 and ban them from working in financial services. They have referred the FCA’s decisions to the Tribunal.
Mr Cuthbert has been fined £91,963 and banned from working in financial services. Mr Cuthbert agreed to settle his case and has not referred the FCA’s decision to the Tribunal.
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