Enforcement: UK's FSA bans partner in telephone sales firm
he Financial Services Authority (FSA) has banned Gerald Classey, a partner at First Colonial Investments LLP (FCI), for several failings, including failing to exercise proper supervision of the stock-broking business of the firm and not telling the FSA about previous convictions.
FCI operated as an appointed representative of Direct Sharedeal Limited until March 2009 and its sales advisers made telephone sales promoting high risk securities to retail clients. Classey was the only person approved by the FSA in a significant influence function at the firm.
Classey failed to carry out this responsibility and, as a result, he did not realise FCI’s sales practices were seriously deficient.
The FSA discovered that FCI used unsuitable sales practices, failed to deliver shares to clients, failed to safeguard clients’ money, issued unfair and potentially misleading financial promotions and carried out trades after it ceased to be an appointed representative on 31 March 2009.
In addition, Classey had previously been convicted in the USA for two minor offences which he did not disclose in three separate applications to the FSA to become an approved person.
FCI was put into liquidation and the Official Receiver was appointed on 4 November 2009.
Gerald Classey represented himself as a partner of FCI, and was approved by the FSA to exercise this responsibility from 6 June 2009. He was not a member of the limited liability partnership and had no partnership shares in FCI.
The FSA published a Final Notice in respect of Direct Sharedeal Limited on 18 February 2010.
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