The total of notable FCA fines issued in 2024 so far is just over £35m. This does not include the provisional fine of £5.95m, which is being contested. The trend that appears to be developing this year is that individuals are tripping up, negatively impacting customers and investors.
With this pattern emerging, it is more important than ever for staff, including senior management, to engage in FCA compliance training. The consequences of inadequate advice or misleading information in financial services can be detrimental, resulting in heavyweight penalties.
Top FCA fines in 2024
- Citigroup Global Markets Ltd - £27.7m
- HSBC UK Bank plc, HSBC Bank plc, & M&S Financial Services plc - £6.2m
- Inspirational Financial Management (IFM) - £897k
- James William Edward Lewis - £120.3k
- Floris Jakobus Huisamen - £31.8k
We continuously track the largest Financial Conduct Authority (FCA) fines and identify trends in breaches year on year.
The biggest FCA fines 2024 in detail
1. Citigroup Global Markets Ltd (fined £27.7m)
Breaches of PRIN 2 and 3 and MAR 7A 3.2
The FCA has fined Citigroup Global Markets Limited (CGML) £27.7 million following failures in their systems and controls, which led to the erroneous sale of $1.4 billion in equities across European markets.
In May 2022, a CGML trader intended to sell $58 million worth of equities but mistakenly created an order for $444 billion. Although CGML controls blocked $255 billion, $189 billion was processed and partially sold before the order was cancelled, causing a brief drop in European indices.
The FCA identified deficiencies in CGML's control framework, including the absence of a hard block to prevent such large erroneous orders and ineffective real-time monitoring. The firm's design allowed the trader to override alerts without proper review.
"These failings led to over a billion pounds of erroneous orders being executed and risked creating a disorderly market. We expect firms to look at their own controls and ensure that they are appropriate given the speed and complexity of financial markets."
CGML accepted the findings and settled, receiving a 30% discount on the fine, reducing it from £39.7 million. In addition to this, the Prudential Regulation Authority (PRA) fined CGML £33.9 million in May 2024 following its investigation into related issues.
2. HSBC UK Bank plc, HSBC Bank plc, & M&S Financial Services plc (fined £6.2m)
Breaches of Principles 3 and 6, CONC 7.2.1R, 7.3.4R, and 7.3.14R, and MCOB 13.3.2A
In May 2024, the FCA fined HSBC UK Bank plc, HSBC Bank plc, and Marks and Spencer Financial Services plc a total of £6.28 million for inadequate treatment of customers in financial difficulty.
In 2018, HSBC reported issues with their treatment of customers in arrears from June 2017 to October 2018 and commissioned an independent review. The FCA then required a skilled person review, which found unfair outcomes in 44% of the cases analysed, often involving vulnerable customers.
HSBC subsequently launched a remediation programme, investing up to £94 million to improve operations and governance and providing £185 million in redress to 1.5 million affected customers.
The FCA determined that HSBC breached principles related to responsible organisation and fair customer treatment, as well as specific regulatory requirements. This case underscores the importance of proper procedures, training, and governance when managing customers in financial difficulty.
3. Inspirational Financial Management (IFM) (fined £897k)
Breaches of Principles 3, 6 and 9
The FCA has fined Inspirational Financial Management (IFM) just under £900k after they had poorly advised people to transfer out of defined benefit (DB) pension schemes, including the British Steel Pension Scheme (BSPS).
During the period from June 2015 to December 2017, IFM allegedly failed to properly assess if pension transfers were in clients' best interests, with 83% of their advice not meeting regulatory standards. Upon investigation, the FCA found that Arthur Cobill and William Hofstetter had provided inadequate advice to clients regarding pension transfers, leading to significant financial losses.
Cobill and Hofstetter agreed to pay fines totalling £160,000 and were banned from providing pension transfer advice. Furthermore, with IFM undergoing administration, priority will be given to creditors to ensure adequate compensation for affected clients.
4. James William Edward Lewis (fined £120.3k)
Breaches of APER 2 and COCON 1
James Lewis, the former boss and founder of Shard Capital Partners, has been fined over £120,000 and banned by the FCA for misrepresenting client cash. The FCA found that Lewis provided incorrect information about clients' cash in two separate instances, putting investors at risk.
Between June 2015 and May 2017, he falsely told auditors that Shard held hundreds of millions in cash for a client, which were actually debts owed by another client within the same group. Additionally, in mid-2021, Lewis misled another client by claiming Shard held substantial funds for them despite the entire cash balance having been transferred out earlier.
These misrepresentations led to misstated annual accounts for the clients involved. Shard notified the FCA of the second incident in September 2023, while the first was under review, and Lewis reported his own conduct to the FCA.
"Mr Lewis fell woefully short of the high standards of skill, care and integrity we expect of all those who lead financial firms. Investors depend on accurate information, and Mr Lewis’ actions put investors at significant risk of losses. It is right that he won’t be allowed to work in regulated financial services again."
5. Floris Jakobus Huisamen (fined £31.8k)
Breaches of CoBS (financial promotions in the Issuer sector)
Floris Jakobus Huisamen, a former director at London Capital & Finance (LCF), has been fined £31,800 by the FCA and banned from the financial services sector. He was responsible for compliance at the company but approved numerous misleading financial promotions. This led to thousands of investors being misinformed about the risks involved.
The FCA found that the promotions for minibonds targeted at retail investors misrepresented the true nature of the product, concealing important risks such as hidden charges and the unsustainable lending practices of the company. Despite his own reservations about LCF’s strategy, Huisamen approved these promotions without ensuring their accuracy.
“Mr Huisamen should have ensured LCF’s financial promotions were ‘fair, clear, and not misleading’. However, under him, the approval process became an ineffective tick-box exercise – as a result, thousands of investors were persuaded to invest on the basis of highly misleading statements."
Provisional fine - Nailesh Teraiya (£5.95m fine)
The FCA has provisionally fined Nailesh Teraiya, the former head of Indigo Global Partners Limited, £5.95 million and banned him from regulated activities for his role in a fake trading scheme. Teraiya is contesting the FCA's decision.
The scheme involved Indigo's participation in a fraudulent share trading plan that obtained a purported tax repayment of €91.2 million from the Danish tax authority. However, this repayment was based on non-existent shares, with no dividends or tax deductions.
In addition to this, Teraiya personally received over £5.1 million from third parties for his involvement. The FCA's fine aims to strip Teraiya of the financial gains from the scheme.
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