Financial Conduct Authority  

FCA to pay after naming adviser in supervisory notice

FCA to pay after naming adviser in supervisory notice

The Financial Conduct Authority is set to compensate an adviser after naming them in a supervisory notice that was picked up by the press. 

In the latest ruling published by the Complaints Commissioner, the regulator has been asked to compensate an adviser £500 after their firm was named in a supervisory notice which the complainant claims "destroyed" their reputation. 

The watchdog has also been asked to compensate the adviser a further £250 for delays in handling their case, with the FCA taking more than a year to respond to the complaint and allegedly assigning seven different case handlers to the case.

In 2018 the FCA issued a first supervisory notice against a firm which the complainant had applied to become an appointed representative of, with their own firm named in the notice and the adviser identifiable as the sole director. 

Whilst the FCA did not breach any statutory or legal requirements in naming the would-be appointed representative, the lead person working on the case reflected on the decision and chose to issue a redacted notice which did not name the complainant soon after.

But because the first notice had been published on a Friday and not removed from the FCA website until the following Monday, and with the amended version not published until the Wednesday, over that weekend the press picked up the story and named the adviser and his link to the other firm. 

The complainant claimed this "destroyed their reputation and business ventures", but the FCA argued the publication of the unredacted notice had no financial impact on their firm.

The regulator instead suggested the adviser had suffered because their application to become an appointed representative was not successful and the firm was not directly authorised to carry out regulated activity without it. 

Nevertheless, complaints commissioner Antony Townsend felt a compensation payment of £500 was owed to the complainant on an ex gratia basis and as a result of the "distress and inconvenience" which arose from the publication of the unredacted supervisory notice. 

The commissioner also recommended the FCA pay a further £250 for "delay and maladministration" in handling the complaint, with the regulator taking more than a year to issue a decision. 

Mr Townsend said he had no evidence of an "effective system" at the watchdog to prioritise complaints and warned pressures causing delays within its complaints team had "considerably worsened over the past year".

He added: "I am aware that the complaints team has seen a large increase in its workload and has been struggling to cope. I have not seen any evidence that suggests the failings I have identified arise from bias towards you personally.

"Rather, they are a measure of the difficulties the complaints team has been facing in general and show what happens when a team is inadequately resourced and put under stress.

"However, in view of the high turnover of staff and poor communication you experienced, with little or no activity on your file for many months, I recommend that you receive a further apology for delay from a member of the FCA’s executive committee."