The FCA has stepped in to halt regulated business at a Staffordshire IFA firm allegedly taking unauthorised fees totalling over £250,000 from clients, some elderly and vulnerable.
The regulator today placed a package of restrictions on the Tamworth firm, Colbourne & Company.
The restrictions stop the firm carrying out any regulated activities due to what the FCA called, “concerns about the way it conducts its business.”
According to the FCA’s First Supervisory Notice, two clients, a couple, had “fees” of £218,000 taken from their investments by the firm in just over 3 years. Other clients also had large “fees” taken from investments.
It’s believed an investment platform reported its concerns about large sums being taken from investments.
In another example, another firm informed the FCA that an individual had reported significant unauthorised charges, linked to Colbourne, being taken from a SIPP. The sums “significantly depleted” the value of the SIPP over the course of a year, with more taken out during that period than was left after the discovery of the situation. Approximately £28,000 in “fees” had been taken during the period.
The FCA said: “We consider that Colbourne & Company, a small IFA, has for a number of years been carrying out regulated activities outside it’s Part4A Permission. During this time, it has taken unauthorised fees, believed to total over £250,000, from a number of its retail clients, some of whom are elderly and who may be vulnerable.”
The watchdog’s restrictions will stop Colbourne & Company carrying on any regulated activity and prevent it from reducing the value of the assets it holds, without the consent of the FCA.
The FCA’s restrictions also mean that Colbourne must immediately cease invoicing or collecting all charges, fees and commissions for regulated activities. It must also cease on-boarding any new customers. The firm has also been ordered to write to clients to inform them of the restrictions.
Colbourne & Company is a sole trader with Anthony James Colbourne (SMF16 authorisation) the only person in the firm who was able to conduct regulated activity.
The company has the right to contest the FCA’s First Supervisory Notice on the matter and to appeal to the Upper Tribunal.
Colbourne & Company, which has been authorised since 2001, has been asked for comment by Financial Planning Today.