The Financial Conduct Authority (FCA) has banned two men who arranged for nearly £24m to be put in unsuitable investments.
Mark Kelly and Patrick Gray worked at PCD Wealth and Pensions Management, where between 2008 and 2010 they arranged for more than 350 customers to invest in these products but failed to declare the fees the company was receiving from a number of these investments.
Mark Steward, director of enforcement and market oversight at the FCA, said: “These two individuals misused pension funds, endangering the retirement incomes of hundreds of people.
“While further investigations continue, the FCA considers it necessary to prohibit them to help protect consumers.”
Mr Kelly traded under the name PCD Wealth and Pensions Management and Mr Gray was one of his advisers. The regulator ruled that they lacked integrity.
Between August 2008 and July 2010, Mr Kelly invested customers’ pension funds in risky investments without their knowledge or consent.
The FCA said the process was designed to prevent customers from discovering where their funds had been invested.
Mr Kelly also received money from product providers taken directly out of customers’ investments without their knowledge and arranged for this to be paid directly into a bank account in his name.
Meanwhile, Mr Gray gave investment advice to at least five customers in the knowledge he had no qualifications or training to do so, and in one case he gave unsuitable advice to a customer to invest in an unregulated collective investment scheme.
The FCA also found that Mr Gray misled it by claiming he did not advise customers, and by saying the Sipp application forms he presented to customers to sign contained information about fees payable to PCD from their funds when they signed them – in fact he claimed to be a paraplanner.
In its final notice, the FCA said: “The authority considers that Mr Gray’s assertion in interview that he gave no advice to customers was false, and that his assertion that customers thought the advice in the pension reports was not being provided by him is highly implausible.
“The authority also considers that Mr Gray’s statement to a customer that he was ‘exceptionally proud of his track record’ as an adviser further demonstrates the falsity of his statement to the authority in interview that he was a paraplanner.”
The FCA said it cannot fine either individual because they were not approved persons at the time of the misconduct.