By June 2023, the Financial Services Compensation Scheme had paid compensation of over £19.8m to 511 of Active Wealth’s former customers.

At least 270 customers suffered losses over the FSCS’s compensation cap of £50,000. Were it not for this cap then the compensation amount would be over £42.3m.

The FCA has issued a fine to Mr Reynolds of £2,212,316.

Mr Reynolds has referred his Decision Notice to the Upper Tribunal where he will present his case.

Mr Deeney was fined £397,400.

The regulator said Mr Reynolds had a “clear disregard for customers’ interests in favour of his own personal gain”.

According to the regulator, he established, maintained and concealed a business model which incentivised recommending products which produced the highest commission for the adviser rather than the best outcome for the customer, and exploited this to the detriment of Active Wealth’s customers so that he could receive £1.01m in prohibited commission payments.

These payments were funnelled via companies connected to Mr Reynolds.

Mr Reynolds advised more than 670 customers, including 150 British Steel Pension Scheme (BSPS) members, to put their money into investments that the regulator said he knew were not suitable for them.

The regulator added that in addition: “Mr Reynolds dishonestly misled the FCA and recklessly allowed the destruction of evidence relevant to its investigation.”

Mr Deeney settled his case with the FCA in May 2022.

The regulator said that he made personal financial gains exceeding £200,000 by providing Active Wealth customers with unsuitable advice so that he could dishonestly receive banned commission payments. Mr Deeney’s misconduct then continued at Fortuna Wealth Management Limited (Fortuna), a firm he established which purchased Active Wealth’s goodwill and client database, where the regulator said he repeatedly sought to mislead the FCA about his role in advising customers to invest in high-risk investments.

Mr Reynolds applied for privacy in relation to his Notice, but the Upper Tribunal refused that application on 20 September 2023.

Therese Chambers, joint executive director of enforcement and market oversight at the FCA, said: “This is one of the worst cases we have seen. Mr Reynolds, who allowed evidence to be destroyed and who has consistently sought to evade accountability, and Mr Deeney, lied and lied again. First, to dupe people into leaving safe pension schemes and placing money meant for their retirement in unsuitable, high-risk investments. Then to try and hide their misconduct from us. Their motivation was based on self-enrichment. Such people have no place in our industry.”