Financial advisers under inquiry get warning

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Financial advisers and organisations involved in the finance industry across the region who may be under investigation by the financial regulators for no apparent reason are being warned to seek legal advice.

Financial advisers and organisations involved in the finance industry across the region who may be under investigation by the financial regulators for no apparent reason are being warned to seek legal advice.

Rachel Adamson, head of fraud and regulatory at Preston-based niche law firm Adkirk Law with more than 25 years’ experience in her field, is advising independent organisations and individuals to be careful when the Financial Conduct Authority (FCA) start an investigation because of alleged breaches of the regulations.

She said: “The original alleged breach may not be serious at all, and in many cases may not represent an actual breach. It may be that one of the organisation’s processes may need amending slightly.

“The investigations can take time to resolve and distract individuals and companies from their core business. Taking good advice can be the difference between being able to carry on in business or being prosecuted and/or closed down in the most serious of cases.

“A current trend for the FCA is to investigate the unregulated market selling investments such as mini-bonds. The best way to describe this is an IOU written to the investor by the company for a fixed rate of interest over a fixed period of time.

“It is essential that those investment companies promoting deals like this only promote to the exempted categories of high net worth investors and those known as sophisticated investors. There are many unregulated companies raising money for property developers in this way and it is these companies who are the focus of attention for the FCA.

“It is absolutely essential that these unregulated companies do not give any financial advice as they would then be in breach of the regulations and open to enforcement action.”

Over the last year, the FCA has undertaken an extensive programme including investigating more than 80 cases of regulated activities potentially being carried out without having the right FCA authorisation and assessing over 200 cases of financial promotions that appeared not to have complied with the FCA rules.

Rachel Adamson has defended a number of cases recently brought by the FCA as well as defended cases brought by the Crown Prosecution Service (CPS), the Serious Fraud Office, HM Revenue and Customs and Trading Standards.

Adkirk Law is a leading UK Law firm offering a niche practice with expertise in serious fraud, regulation and police misconduct, acting for many high-ranking police officers accused of wrong-doing.

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