Complaints Commissioner  

FCA's watchdog criticises regulator in Keydata saga

From December 2005 to June 2009, more than 37,000 investors purchased the products, investing more than £475m.

Much of this money was later paid out in compensation to investors by industry funded lifeboat scheme the Financial Services Compensation Scheme.

The FCA would go on to ban Keydata's chief executive Steward Ford and fine him £76m - the largest fine given to an individual.

Somal noted that the complainants had to wait a long time for their complaints to be resolved following a referral and delays in the FCA’s complaints investigation.

All four complaints were reactivated in January 2019 after the Upper Tribunal upheld the FCA's decision to fine and ban Ford.

FCA response

In its reponses, the regulator said it expected the recommendations made, with the exception of the level of payment for distress and inconvenience.

The FCA stated: “We acknowledge that the service provided during the handling and investigation of this complaint was not good enough and the complainant had to wait longer than they should have to receive our response.

"We have been regularly liaising with the commissioner to keep her updated on the improvements being made and will continue to do so."

While the regulator did not agree with the levels of compensation set by the commissioner it was willing to increase the amount of compensation it originally offered.

Separately, the chairman of the FCA has written to the complainants to apologise for the errors made in the supervision of Keydata, the delay in commencing effective supervisory and enforcement action, and for the level of service provided during the investigation of this complaint.

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