Release Date: 16th September 2014
To access the original FCA document, click here.
Summary
Peter Carron, a former senior partner at St James’s Place Wealth Management Plc, has been fined £300,000 and permanently banned from performing any regulated financial services activities by the Financial Conduct Authority (FCA). The punitive action was taken after Carron was found to lack honesty and integrity following his advice to clients to invest in three companies where he held significant control without proper disclosure.
Between 2004 and 2010, Carron advised 11 clients to invest a total of £2.4 million in Primrose Associates Limited, Evaluate Technologies Limited, and Comment Technologies Limited—companies in which he was both a director and a majority shareholder. These companies subsequently went into liquidation between May and August 2010, resulting in substantial losses of around £2.2 million for the investors. In response, St James’s Place compensated these clients to the tune of £1.9 million.
Tracey McDermott, the FCA’s director of enforcement and financial crime, criticised Carron for prioritising his personal interests over those of his clients. Carron misled clients about the viability and likely performance of the investments, falsely guaranteeing returns and providing inappropriate financial projections, even during periods when he knew the companies were struggling financially. He further misrepresented the investments as being approved or endorsed by St James’s Place, and failed to adequately assess the suitability of the investments for his clients or properly inform them of the risks involved.
In addition to the FCA’s actions, Carron was also banned by the High Court in August 2014 for 13 years from acting as a company director or having any management or control in a company due to his actions.
This case serves as a significant reminder to financial advisers about the critical importance of integrity and transparency in their advisory roles. Advisers are urged to ensure full and clear disclosure of any personal interests in investment opportunities they recommend to clients. They must also ensure that all investments advised are suitable for the clients’ needs and that clients are fully informed of potential risks. Such measures are necessary to uphold trust in financial advisory services and protect consumer interests.
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