FCA bans and fines TMI’s Robert Shaw for SIPP advisory failings

complianceThe Financial Conduct Authority (FCA) has banned Robert Shaw, former director of advisory firm TailorMade Independent (TMI), from senior positions in financial services and fined him £165,900 (€232,670). The FCA found that Shaw failed to ensure TMI assessed the suitability of investments made through self-invested personal pensions (SIPPs) for its customers, and was also involved in conflicts of interests for the firm. Georgina Philippou, acting director of enforcement and market oversight at the FCA, says: “Robert Shaw exposed customers to risky investments without considering if these products would meet their needs. In addition, he personally benefitted from sales of these products without revealing to customers the full extent of the benefits he received. “His actions mean that many customers faced losing all of their hard-earned pension funds.  This is not the conduct we expect of senior individuals.” Shaw benefitted financially from being the director and shareholder of TailorMade Alternative Investments (TMAI), an unregulated introducer, which referred clients to TMI.  The financial benefit he received created a conflict of interest with his duty to TMI’s customers to run the business compliantly. Shaw failed to identify and disclose these benefits to customers, despite being warned by TMI’s external compliance consultants. TMI provided advice to customers on transferring their existing pension funds into unregulated investments such as green oil, biofuels, farmland and overseas property via SIPPs.  Between 2010 and 2013, 1,661 customers invested £1.12 billion in these investment products, many of which were not typically permitted by their existing pension schemes. More than half of the affected customers invested in overseas property operated by the Harlequin group of companies, which is under investigation by the Serious Fraud Office. TMI has ceased trading and is now in liquidation and the Financial Services Compensation Scheme (FSCS) is investigating claims made by TMI’s customers. ©2015 funds europe

Executive Interviews

INTERVIEW: Put your money where your mouth is

Jun 10, 2016

At Kempen Capital Management, they believe portfolio managers should invest in their own funds. David Stevenson talks to Lars Dijkstra, CIO of the €42 billion manager.

EXECUTIVE INTERVIEW: ‘Volatility is the name of the game’

May 13, 2016

Axa Investment Managers chief executive officer, Andrea Rossi, talks to David Stevenson about bringing all his firm’s subsidiaries under one name and the opportunities that a difficult market...


ROUNDTABLE: Beyond the hype

Oct 13, 2016

The use of smart beta investing continues to grow. Our panel, made up of both providers and users, discusses what the strategy actually means, how it should be used and the kind of pitfalls that may arise when using this innovative investment technique.

MIFID II ROUNDTABLE: Following the direction of travel

Sep 07, 2016

Fund management firms Aberdeen and HSBC Global meet with specialist providers to speak about how the industry is evolving towards MiFID II.