FCA not taking action against Blackmore Bond promoters
The Financial Conduct Authority (FCA) has decided not to take enforcement action against the promoters of Blackmore mini-bonds, after spending 7,330 hours on its investigation.
In a letter to the chair of the Treasury Select Committee, Therese Chambers, joint executive director of enforcement and market oversight at the FCA, said the regulator will not take any action against NCM Fund Services and Northern Provident Investments (NPI).
The investigation, which involved going through 8,000 documents, concluded that the financial promotions were “largely accurate” and “contained very relevant risk warnings to consumers”.
Read more: FCA admits “human error” on Blackmore Bond supervision
Blackmore Bond raised millions of pounds between 2016 and 2018 by issuing mini-bonds. The group went into administration in April 2020. Earlier this year, the FCA admitted that “human error” contributed to its failure to protect investors, many of whom had been told that they will not receive any money back.
In her letter, Chambers said she understands that “it is very distressing for consumers who lost money in Blackmore”.
The regulator has 26 outstanding complains which allege that the FCA has failed to protect investors. Now that its investigation into NCM and NPI has concluded, the regulator will consider these complaints and will aim to respond “as soon as practicable”.
Chambers also highlighted changes the FCA made in the way it operates to ensure that it takes timely action against firms breaching financial promotion rules.
Read more: Blackmore Bond administration costs near £3m
She concluded: “Where serious misconduct is alleged, enforcement investigations are an invaluable tool. It is vital our investigations are conducted thoroughly and fairly, which means never prejudging the conclusion and taking action only where we have sufficient evidence to justify it. I recognise that many will be disappointed that we have not found that evidence to the required legal thresholds in these investigations. I hope, however, we have shown that we looked at all the available information and considered all potential avenues.”
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