Independent financial advisers (IFAs) who do not directly advise clients risk being fined by the FSA.
DBS Financial Management was fined £100,000 for merely approving a direct offer advertisement for Protected ISAs. The approval was contained in a brochure distributed in national newspapers.
The FSA found that the brochure made misleading claims about the nature of the investment, the applicable charges, the price of protection and future growth.
But DBS had not directly advised any of the consumers who invested in the Protected ISA.
Law firm Reynolds Porter Chamberlain partner Jonathan Davies said: "This [decision] contrasts with previous fines, for example in relation to endowment sales, where firms had been fined for mis-advice. It sends out a strict warning to IFAs that even when advice is not provided directly to clients, any information issued firms will still come under scrutiny."
