FSA ACTION: Direct Sharedeal Limited

The FSA fined Glasgow-based stock broking firm Direct Sharedeal Limited (DSL) £101,500 after its appointed representative, First Colonial Investments LLP (FCI), used misleading sales pitches which failed to set out the inherent risks of buying penny shares.

DSL specializes in spread betting and share dealing.  It provided an avenue for FCI to carry out penny share sales, and should have made sure that FCI was providing customers with accurate and sufficient advice to make informed decisions about whether to invest in penny shares.

An FSA investigation found FCI’s sales showed scant regard for their customers.  Potentially misleading sales pitches were used to persuade people to buy shares, regardless of whether those shares were suitable.  FCI failed to mention the risks associated with their recommendations, and made misleading statements about the companies they were advising people to invest in.

FCI also placed its customers’ money at risk by holding it in a connected, but unregulated, firm.  As a result, DSL was fined £101,500 for failing to monitor FCI’s customer treatment, along with that of other former appointed representatives.

Share this post

Share on facebook
Share on twitter
Share on linkedin
Share on pinterest
Share on print
Share on email

Stay On Top Of The Debt Relief Industry's Regulatory Landscape

On November 6-7, 2022, Shipkevich PLLC will be hosting a Regulatory Workshop in Costa Mesa, California focusing on the fundamental regulatory issues facing debt relief professionals and how they can adapt.