The UK Financial Conduct Authority (FCA) has fined a former director of London Capital & Finance plc (LCF) £31,800 and banned him from working in financial services.
Floris Jakobus Huisamen was responsible for compliance at LCF but recklessly signed off hundreds of financial promotions, which contributed to thousands of investors being misled.
LCF marketed minibonds to retail investors. Financial promotions, signed off by Mr Huisamen, presented a misleading picture of the minibonds, making them appear a far more attractive investment than they were. Investors were not given the full picture about the risks of the product, including the presence of hidden charges and the unsustainable nature of the lending being carried out by LCF.
Mr Huisamen signed off these financial promotions despite his own concerns about LCF’s strategy. He failed to provide proper scrutiny or sufficiently challenge senior management. In particular, he failed to obtain evidence of the claims being made, allowed promotions that gave a misleading impression that the minibonds were regulated by the FCA and continued to approve promotions even when he became aware of inaccurate claims.
Mr Huisamen agreed to settle the case and so qualified for a 30% discount. Without this discount, the penalty would have been £45,500.
