Menu
18/04/2011
FSA Fines N&P £1.4 Million
The Financial Services Authority (FSA) has fined Norwich and Peterborough Building Society (N&P) £1.4 million for failing to give its customers suitable advice in relation to the sale of Keydata products.
N&P will make available ex gratia payments to all customers to ensure they do not lose out as a result of their investment, amounting to approximately £51 million in total.
During a period of over three years N&P advised 3,200 clients to invest in Keydata’s life settlement products. N&P failed properly to assess the financial circumstances of many of its customers, designating them as having a higher tolerance of risk than was appropriate. This led to unsuitable sales. Some customers were moved out of low risk products such as deposit accounts into Keydata investments, putting their income and capital at risk. Many of these customers were approaching or already in retirement, and could not afford to lose their money.
In June 2007 N&P carried out a review prompted by the realisation that Keydata products formed 30% of all investment products sold during the first three months of that year. Their compliance team produced a report setting out concerns about the suitability of advice given to customers. No effective action was taken and Keydata sales remained consistently high.
Tracey McDermott, FSA Acting Director, Enforcement and Financial Crime, said: “N&P failed in its basic duty to provide suitable advice to its customers, despite an internal compliance report pointing out that there were problems as early as 2007.
“Firms cannot treat customers fairly unless they pay attention to their financial circumstances and attitude to risk when they make recommendations. This is the only way to prevent widespread mis-selling like this.”
N&P has also agreed to commission an independent review of sales of other financial products sold by their Financial Advice Service, and will pay redress where appropriate.
N&P co-operated with the FSA’s investigation and agreed to settle at an early stage.
(BMcN/GK)
N&P will make available ex gratia payments to all customers to ensure they do not lose out as a result of their investment, amounting to approximately £51 million in total.
During a period of over three years N&P advised 3,200 clients to invest in Keydata’s life settlement products. N&P failed properly to assess the financial circumstances of many of its customers, designating them as having a higher tolerance of risk than was appropriate. This led to unsuitable sales. Some customers were moved out of low risk products such as deposit accounts into Keydata investments, putting their income and capital at risk. Many of these customers were approaching or already in retirement, and could not afford to lose their money.
In June 2007 N&P carried out a review prompted by the realisation that Keydata products formed 30% of all investment products sold during the first three months of that year. Their compliance team produced a report setting out concerns about the suitability of advice given to customers. No effective action was taken and Keydata sales remained consistently high.
Tracey McDermott, FSA Acting Director, Enforcement and Financial Crime, said: “N&P failed in its basic duty to provide suitable advice to its customers, despite an internal compliance report pointing out that there were problems as early as 2007.
“Firms cannot treat customers fairly unless they pay attention to their financial circumstances and attitude to risk when they make recommendations. This is the only way to prevent widespread mis-selling like this.”
N&P has also agreed to commission an independent review of sales of other financial products sold by their Financial Advice Service, and will pay redress where appropriate.
N&P co-operated with the FSA’s investigation and agreed to settle at an early stage.
(BMcN/GK)
Related UK National News Stories
Click here for the latest headlines.
26 September 2013
Mortgage Customers To Be Compensated For Banks Error
Thousands of mortgage customers of Clydesdale and Yorkshire Bank are to be compensated following a ruling that they were treated unfairly. It is understood that the bank miscalculated some 22,000 customers' variable rate home loans, with the customers subsequently paying too little over a four-year period.
Mortgage Customers To Be Compensated For Banks Error
Thousands of mortgage customers of Clydesdale and Yorkshire Bank are to be compensated following a ruling that they were treated unfairly. It is understood that the bank miscalculated some 22,000 customers' variable rate home loans, with the customers subsequently paying too little over a four-year period.
24 October 2008
Ofgem Launches 'Energy Best Deal'
Energy regulator Ofgem has launched Energy Best Deal, a campaign to empower low income customers with the information to help them make the most of the energy market. The campaign has been devised by Ofgem and Citizens Advice and has been funded by the Department for Energy and Climate Change (DECC).
Ofgem Launches 'Energy Best Deal'
Energy regulator Ofgem has launched Energy Best Deal, a campaign to empower low income customers with the information to help them make the most of the energy market. The campaign has been devised by Ofgem and Citizens Advice and has been funded by the Department for Energy and Climate Change (DECC).
01 September 2015
Contactless Card Payment Limit Increases To £30
The limit on contactless card payments has increased from £20 to £30, the UK Cards Association has announced. Payment terminals are being updated to accept the new limit from today Tuesday, 1 September. The move comes as figures reveal contactless spending rose from £287m in January to £567m in June. In total, £2.
Contactless Card Payment Limit Increases To £30
The limit on contactless card payments has increased from £20 to £30, the UK Cards Association has announced. Payment terminals are being updated to accept the new limit from today Tuesday, 1 September. The move comes as figures reveal contactless spending rose from £287m in January to £567m in June. In total, £2.
13 January 2011
British Gas Invests For Vulnerable Customers
British Gas have announced that it is making a new investment of £37 million in support for its vulnerable customers. Each customer on British Gas' Essentials social tariff will receive £50 as a credit on their winter bill. Prepayment customers will receive the credit direct to their meter.
British Gas Invests For Vulnerable Customers
British Gas have announced that it is making a new investment of £37 million in support for its vulnerable customers. Each customer on British Gas' Essentials social tariff will receive £50 as a credit on their winter bill. Prepayment customers will receive the credit direct to their meter.
27 November 2007
Post Early For Christmas
With Christmas drawing closer, Royal Mail is reminding customers that it's time to make sure festive greetings and gifts are winging their way to friends and family across the globe in good time.
Post Early For Christmas
With Christmas drawing closer, Royal Mail is reminding customers that it's time to make sure festive greetings and gifts are winging their way to friends and family across the globe in good time.
-
Northern Ireland WeatherToday:A showery start with outbreaks most frequent north of Lough Neagh and through the morning, before dwindling during the afternoon as the northwest breezes ease and brighter spells of weak sunshine prosper. Maximum temperature 8 °C.Tonight:A dry night, save for a few light showers around the coasts, with prolonged clear spells and light winds bringing a frosty dawn for many in central and southern parts. Minimum temperature -3 °C.
