Case Histories

Self certified mortgages investigations
A small firm of mortgage brokers in Glasgow had their permissions suspended in total by Supervisory Notice without a hearing by FSA because of alleged fraudulent self certified mortgage applications.  The IFA was placed under huge financial and personal pressure over many months due to the intimidatory approach of the FSA Enforcement’s Investigation Team.  After an aggressive defence and lengthy argument before the FSA’s Regulatory Decisions Committee (effectively the FSA’s regulatory court) all of the orders against the IFA were lifted and the IFA was given all of is permissions back without reservation.

GTEP Investigations No 1 and No 2
Two current Enforcement investigations into the alleged miss-sale of GTEPs.  Contrary to the IFAs’ own indemnity insurers suggestions, a very aggressive, confrontational approach has been adopted and argued vigourously in defence of both resulting in the FSA dropping one third of one case.    In the other case an Enforcement team was informed that the police would be brought in to investigate the FSA’s Supervision team’s evidence.  The FSA have since dropped two thirds of that case.  Neither case have yet been put to the RDC because, I believe, the FSA investigators know that I will heavily criticise their professionalism and their competence.

UCIS Supervision review No 1
Following a Supervision visit a part of the FSA Thematic Review the FSA were given a detailed note of the proceedings, but did not challenge it.  The subsequent FSA  Report bore no resemblance to notes,  contained numerous and serious factual inaccuracies and misrepresentations of the IFA’s client files, and displayed a lack of knowledge and understanding the FSA’s own rules.  The case has been reported to the appropriate divisional Managing Director of the FSA.  The Firm is refusing to vary its permissions and is refusing to instruct a Past business Review on the basis of the FSA’s flawed report and is prepared to go to the Tribunal.

UCIS Supervision review No  2
The FSA's Supervision Report was riddled with inaccuracies and a clear failure to understand the law and the rules. The response on behalf of the IFA shredded the FSA report but it insisted on following regulatory proceedings and refused to respond to the numerous failings highlighted. The IFA unwittingly recorded all of the calls with the FSA which indicated a version of the discussions quite different from that as recalled by the FSA officer, and raising issues of truthfulness of that FSA officer. A new Supervision team leader was appointed and I forced a meeting with senior FSA officers which resulted in a fresh Supervision Review. Following on from that I assisted the IFA in undertaking a Past Business Review, designing the format of the review documentation and working with the new FSA Supervisor the Review was managed out without the matter being referred to the FSA Enforcement for investigation.

UCIS Supervision review No  3
In this case I was brought in by a small firm of IFAs after the FSA Supervision team had carried out its review, submitted its report connculdign the IFA had breached the rules on promotion and had required the firm to instruct a Skilled Persons Report (SPR). The SPR concluded that in most cases the firm had breached the statutory prohibition against promoting UCIS. On the basis of that Report the FSA then wanted the firm to carry out a Past Business Review (PBR) on the suitability of its advice in its UCIS sales. I challenged the SPR on numerous grounds and extracted from the skilled person that whether an IFA had properly applied the exemptions to the prohibition was a matter of subjective opinion. I also repeatedly insisted that the notices served by the FSA requiring the SPR in the first place and also the PBR, were both legally incompetent. Prolonged argument with FSA followed during which it pressurised the IFA into undertaking a fresh SPR which in my view, and which I stated to the FSA, was simply to get a report which said what the FSA wanted it to say ie that the firm was in breach of the rules, it has now conceded that it will not be requiring a new SPR. I and the FA are now working with the FSA on the carrying out of a Past Business Review into the suitability of the sales.

Consumer complaint No 1
A businessman running 3 separate companies handed over the management of his entire investment business to an appointed representative of a large international IFA. He was miss-sold 49 + endowment and other policies. After 10 months alternately deliberate delay, refusal to produce file papers and making varied threats of reporting my client to the police, HMRC and other authorities for alleged tax fraud and financial crime, the complaints were lodged with FOS. The IFA, having informed my client that it had no papers relating to these sales, was eventually forced to concede a CD to the FOS containing some 3,000 documents. After protracted argument, over some 10 months, the IFA has now conceded that it will not be disputing liability and the FOS has upheld all complaints. The settlement offer presently sitting on the table to be discussed is £400,000.

"Class action" consumer complaint No 1
Acting on the instructions of a number of IFAs, initially 115 individual investing clients' complaints were made to a London firm providing a foreign exchange trading platform. The complaints related to failings in its administration of a Forex trading programme. All 115 complaints have since been referred to the Financial Ombudsman Service (FOS), with two cases being treated as "test cases". This has now grown to 147 complaints at varying stages. The FOS adjudicator's initial assessment was to reject one test case complaint altogether, and to uphold the other but with limited redress. After very prolonged, technical and detailed arguments running to many hundreds of pages of documentation, and despite the forex firm engaging one of the heavy weight London lawyers, I have now persuaded the FOS adjudicator to reverse its initial rejection of one test case and to revise its assessment of the other test case so that both test case complaints would be upheld with full redress. The forex firm has requested that these cases be reviewed by the FOS Ombudsman. The total value of claims I am handling in this class action is around £5.5m.

"Class action" consumer complaint No 2
Again acting on the instructions of a number of IFAs I investigated the circumstances of a stockbroker's trading of Contracts for Differences for 26 investor clients. I reported back to the IFAs that in my view there the stockbroker had broken its own contractual terms in a number of fundamental respects and that there were grounds of complaint. As I was in the process of intimating complaints to the CFD trading stockbrokers it went into administration. It has since been declared to be in default and I am now handling 26 claims for compensation to the Financial Services Compensation Scheme.

Specialised consumer complaint No 3
Again acting on the instructions of a group of IFAs, complaints are to be submitted on behalf of 30 clients of the IFAs against a firm of stockbrokers operating a contract-for-difference programme. 

Specialised consumer complaint No 4
Again acting on the instructions of IFAs, the workings of a complex geared investment product is under consideration for potential several hundred investors.  The product involves the use a gearing investment loan from a mainstream lender which is secured by rights over the investment assets.  The lender has recently indicated a potentially major change in the annual review procedures that are designed to ensure the investment remains on track with the potential of putting many investment plans in breach requiring “margin calls” if not the possible exercise of the security.  It has been discovered that some of the security deeds have not been signed.  If replicated throughout the lender’s portfolio it could have an exposure in excess of £50m.