Santander fined 1.5mln by FSA

 

The UK's Financial Services Authority (FSA) has fined Santander £1.5m for their failure to advise clients that £2.7 billion of some of the investments which they sold between 2008 and 2010 was not covered by the Financial Services Compensation Scheme (FSCS).

The FSCS is a scheme which offers compensation to customers of any FSA members who may be unable to meet any compensation claim themselves, for example if they cease trading.

Even though none of Santander's clients ade any financial losses due to this misinformation, the FSA imposed the fine because the Bank did not act to confirm whether the investments offered were covered by the scheme quickly enough.

It was noted how clients first began to question whether such investments were covered back in 2008, but despite knowing in June 2009 that its 'Guaranteed Capital Plus' and 'Guaranteed Growth Plan' investment products only carried limited cover, Santander did not ammend the supporting documentation for the investment until the following year.

The amount of cover offered by the FSCS against these investments was limited due to their being held by subsidiaries of Santander, as opposed to by the Bank itself.