FCA Fines Pair £3.8m For Misleading Investors
Credit Suisse and Yorkshire Building Society have been ordered to pay fines totalling almost £4m for promising unrealistic returns in an investment scheme.
The Financial Conduct Authority (FCA) said the marketing for the product - known as Cliquet - targeted investors with a limited knowledge of financial markets who paid in £797m.
It ordered Credit Suisse International (CSI) to pay £2.4m while Yorkshire Building Society (YBS), which distributed the product on Credit Suisse's behalf, was told to hand over £1.4m.
The FCA said it was the first time it had fined the producer and distributor of a product at the same time.
The watchdog's remit is to prevent mis-selling in the wake of several high profile scandals to hit the financial services industry, including payment protection insurance (PPI) and interest-rate swaps.
Its director of enforcement, Tracey McDermott, said: "These promotions were a serious breach of the requirement to be clear, fair and not misleading.
"CSI and YBS knew that the chances of receiving the maximum return were close to zero but they nevertheless highlighted this as a key promotional feature of the product.
"This was unacceptable", she concluded.
The FCA said both firms are to contact customers who bought the product between November 2009 and June 2012 to offer the chance of exiting it without penalty and, where applicable, receive an interest payment.