"As of September 2016 the FSCS has upheld 919 claims of unsuitable advice against TMI, with compensation of over £40 million paid to date."
Mr Burns has referred this Decision Notice to the Upper Tribunal where he and the FCA will each present their case.
The FCA found that between January 2010 and January 2013, TMI provided advice to customers who were considering transferring or switching their existing pension funds via SIPPs into unregulated investments such as green oil, biofuels, farmland and overseas property.
During this period, 1,661 customers invested £112,420,985 in Alternative Investments, many of which were not typically permitted by their existing pension schemes.
As of September 2016 the FSCS has upheld 919 claims of unsuitable advice against TMI, with compensation of over £40 million paid to date. More than half of the affected customers invested in a firm specialising in overseas property which subsequently went into liquidation with the result that the entirety of those investments was lost.
In the FCA’s view, the personal recommendations process used to advise customers, for which Mr Burns was jointly responsible, was inadequate.
Additionally, the FCA says that Mr Burns received significant financial benefit from his positions as a director and shareholder of an unregulated introducer also operating under the ‘TailorMade’ name, which referred clients to TMI.
The financial benefit created a conflict between the interests of Mr Burns in the outcome of TMI’s advice and the customer’s interest in that outcome.
As a director Mr Burns was required to take reasonable steps to ensure TMI complied with regulatory standards. The FCA says he did not do so has decided that he is "not fit and proper to perform senior management or significant influence functions in relation to regulated activity in financial services".
