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FCA fines Santander £12.4 million for five major advice failings
by Dylan Lobo on Mar 26, 2014 at 09:24
Santander UK has been fined £12.4 million for providing unsuitable advice.
The regulator uncovered serious failings in the way it offered financial advice from its bank.
In particular, there was a significant risk of Santander UK giving unsuitable advice to its customers, its approach to considering investors’ risk appetites was inadequate, and for some people, it failed to regularly check that investments continued to meet their needs - despite promising to do so.
The fine is one of the largest enforced on a UK retail bank for providing unsuitable advice.
The watchdog uncovered the failings through a mystery shopping probe and thematic review of the wealth management sector.
When the FSA first put its concerns to Santander UK in late 2012, the firm immediately decided to stop giving financial advice in branches to prevent further problems occurring. In March 2013 Santander shut down the division, which contained 800 advisers.
The FCA’s investigation found that Santander UK had:
* failed to make sure that its advisers were fully getting to grips with customers’ personal circumstances before making a recommendation, including understanding how much risk they were willing to take;
* failed to ensure that customers investing were given clear and not misleading information about its products and services;
* for Premium Investments, failed to carry out regular ongoing checks to ensure the investment was still meeting customer needs;
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