These weaknesses led to compensation of £132,000,000 being paid to ensure that none of the funds Aviva Investors managed was adversely impacted.
The FCA concluded that Aviva Investors failed to take reasonable care to organise and control its affairs responsibly and effectively with adequate risk management systems and failed to manage conflicts of interest fairly, both between itself and its customers and between customers and other clients.
Georgina Philippou, Acting Director of Enforcement and Market Oversight at the FCA, said:
“Ensuring that conflicts of interest are properly managed is central to the relationship of trust that must exist between asset managers and their customers. It is also a fundamental regulatory requirement. This case serves as an important reminder to firms of the importance of managing conflicts of interest effectively by implementing a robust control environment with effective systems to manage the risks. Not doing so risks customers’ interests being overlooked in favour of commercial or personal interests.
“While Aviva Investors’ failings were serious, the FCA has recognised that its actions since reporting its failings were exceptional. The level of co-operation during the investigation and commitment to ensuring no customers were adversely impacted meant it qualified for a substantial reduction in the penalty.”
