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Release Date: 16th June 2014

To access the original FCA document, click here.


The Financial Conduct Authority (FCA) has issued fines to Credit Suisse International (CSI) and Yorkshire Building Society (YBS) for failing to ensure that financial promotions for CSI’s Cliquet Product were clear, fair, and not misleading. Credit Suisse was fined £2,398,100 while Yorkshire Building Society received a £1,429,000 penalty.

The Cliquet Product, designed by CSI, was intended to offer capital protection and a guaranteed minimum return, with the possibility of a higher return if the FTSE 100 performed exceptionally well. However, the likelihood of achieving the maximum return was nearly zero, a fact that was not adequately communicated to the investors. Despite this, the promotional materials highlighted the potential maximum return as a major selling point. This product was mainly sold to conservative and risk-averse customers, often described as “stepping stone customers,” who generally had limited investment knowledge and experience. A total of 83,777 customers invested £797,380,716 in the product, with YBS responsible for distributing about 75% of this amount.

The promotional issues were exacerbated by both CSI and YBS giving undue prominence to the unlikely maximum return in their brochures and financial promotions. Although YBS made changes to its promotions in 2010 following external criticism to reduce the emphasis on the maximum return, the overall impression of the likelihood of achieving it remained misleading. CSI, on the other hand, decided against making significant changes to its promotional materials even after similar critiques.

The FCA also identified a failure in CSI’s processes, noting the absence of a procedure for periodic comprehensive reviews of long-standing promotions, which could have corrected the misleading information sooner.

Both firms settled early in the FCA’s investigation, receiving a 30% discount on their fines. This case marks the first instance where the FCA has taken action simultaneously against both the manufacturer and distributor of a financial product for promotional failings.

The key takeaways for other firms involve the critical importance of providing clear, fair, and transparent information in financial promotions, particularly concerning the realistic outcomes of financial products. Firms must also establish and maintain robust review processes to ensure ongoing compliance with regulatory standards. This case underscores the FCA’s commitment to protecting consumers and enhancing the integrity of the financial system by holding firms accountable for misleading financial promotions.

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