Another naughty bank
Santander has become another naughty bank to join the long list of those caught delivering bad investment advice with a £12.4m fine issued by the Financial Conduct Authority (FCA) today.
The fine for poor investment advice followed a mystery shopping exercise back in 2012 which found “significant deficiencies” in their suitability processes.
The regulator also found their processes for ensuring financial promotions and communications were fair, clear and not misleading were faulty.
These findings covered the sale of retail investment products by Santander between January 2010 and December 2012. Failings were referred to as the FCA as “systematic”.
As a result of the fine, Santander is now writing to affected customers, offering them the chance to withdraw from their investment or have a review carried out, with the possibility of redress being paid.
In a rather stinging statement accompanying the news, FCA director of enforcement and financial crime Tracey McDermott said:
“Customers trusted Santander to help them manage their money wisely, but it failed to live up to that responsibility.
“If trust in financial services is going to be restored, which it must be, then customers need to be confident that those advising them understand, and are driven by, what they need.
“Santander let its customers down badly.”
The good news for customers is that Santander no longer provides investment advice, after withdrawing from this market in March 2013.
It is rare for a month to go by when a bank or building society is not making headlines for the delivery of poor investment advice.
As we have often commented, you should never go to your bank for financial or investment advice; if you do, there is a very high probability it will be unsuitable.
Instead, seek professional advice from an independent financial adviser, preferably a firm of Chartered Financial Planners.
Pay a fee for advice which is not linked to the sale of a financial product. This approach removes the inherent bias which still exists when financial advisers work on a speculative basis and are only paid when they sell you a product from which they can extract an adviser charge.
If you were a Santander customer and have any concerns about the ongoing suitability of your investments, do get in touch and we would be happy to engage with you as a client of Informed Choice.