Financial Ltd, which was issued a final notice by the regulator in July 2014, has been acquired by Tavistock Investments as part of a broader deal which has led to the creation of newly established network called Tavistock Financial Ltd.
Tavistock said this morning it had completed the acquisition of Standard Financial Group Ltd, together with Financial Ltd and Investments Ltd - its two trading subsidiaries.
The firm said the acquisition means it has a national network of 270 self-employed financial advisers.
It will offer the services of its investment management business, Tavistock Wealth, to their underlying clients, whose assets are estimated to exceed £3 billion, the announcement stated.
After FCA approval Tavistock said it had “conducted a risk appraisal of all members of Financial’s advisory network; following which, it has transferred the significant majority of those members across to a newly established network, Tavistock Financial Ltd”.
The FCA issued a 126 day trading ban in July 2014 and said at that time: “Were it not for Financial’s financial position the Authority would have imposed on Financial a financial penalty of £12,589,134.
“Financial agreed to settle at an early stage of the Authority’s investigation. Financial therefore qualified for a 30% (stage 1) discount under the Authority’s executive settlement procedures.
“Were it not for this discount, the Authority would have imposed a restriction of 180 days (6 months) on Financial.
"As a result of Financial’s failures during the Relevant Period over 60,000 customers were exposed to the real risk that its ARs and RIs would make recommendations, including in relation to high risk products, which were unsuitable."
A statement from Tavistock about the acquisition today read: “Tavistock has also disposed of IL’s sub-scale investment management business and transferred all of FL’s and IL’s support staff and operations across to TFL.
“The combined effect of these developments has reduced the operating costs of the network business by more than £1 million per annum, so that TFL trades profitably.
“Having secured the cancellation of regulatory permissions for FL and IL from the FCA, the final step in the integration process is to close down the three entities, SFG, FL and IL.
“The company is therefore pleased to announce that it has now placed these three entities into members voluntary solvent liquidation.”
Brian Raven, Tavistock’s chief executive, said: “Whilst the integration of these businesses into the Tavistock Investments Group has absorbed a considerable amount of management’s time over the past nine months, we are very pleased with the outcome and anticipate that the restructured business will contribute significantly to the company’s future profitability.”