UK Financial Conduct Authority sees bans on pair upheld and censures firm over misleading minibond promotions

The UK Financial Conduct Authority reported two enforcement outcomes involving appointed representative arrangements. The Upper Tribunal upheld its decision to ban Richard Fenech and Heather Dunne from financial services, although it reduced their fines, while the FCA censured Equity for Growth (Securities) Limited for approving unfair, unclear and misleading minibond promotions. The tribunal found that Fenech and Dunne acted dishonestly by providing the FCA with a backdated appointed representative agreement. It also found that Dunne made false claims about when she had provided advice and failed to take proper care over pension transfers, while Fenech failed to oversee her work properly. Dunne advised about 92% of clients to leave defined benefit schemes between April 2015 and June 2017, resulting in transfers exceeding GBP 126 million. After finding that 18% of her clients received unsuitable advice, the tribunal reduced the fines to GBP 41,230 for Dunne and GBP 16,046 for Fenech. They have 14 days from the tribunal’s decision to appeal. Equity for Growth approved minibond promotions that did not disclose very high commissions charged by its appointed representatives and other introducers, or explain that the fees would be deducted from investors’ money. The FCA did not impose a penalty because the insolvent firm is being wound up and a fine would reduce funds available to creditors. It would otherwise have imposed a GBP 386,467 penalty. Investor claims will be assessed by the Financial Services Compensation Scheme.