Norwich and Peterborough Building Society fined �1.4m over Keydata mis-selling
THE Norwich and Peterborough Building Society has been fined �1.4m for mis-selling financial products to customers.
The Financial Services Authority (FSA) announced its decision this morning after around 3,200 of N&P’s customers lost millions by investing, on their advice, in Keydata - a financial services company which went into administration in the summer of 2009.
The N&P had already announced it will make ex-gratia payments to all customers to ensure they do not lose out as a result of their investment, amounting to approximately �51 million in total.
Among those who were mis-sold investments was businesswoman Carol Scholes, from Walsoken, who invested her life savings in the company.
The 66-year-old lost �260,000 - the proceeds from the sale of her Wisbech grocery store, Waltons.
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A statement from the FSA said: “During a period of over three years N&P advised 3,200 clients to invest in Keydata’s life settlement products.
“N&P failed properly to assess the financial circumstances of many of its customers, designating them as having a higher tolerance of risk than was appropriate. This led to unsuitable sales.
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“Some customers were moved out of low risk products such as deposit accounts into Keydata investments, putting their income and capital at risk. Many of these customers were approaching or already in retirement, and could not afford to lose their money.”
Gordon Horsfield, chairman of N&P, said: “The Society is committed to its members and has been deeply concerned for those customers who bought these products and who lost out following Keydata’s administration in 2009.
“Our aim in making ex-gratia payments is to put that right and we are very sorry for the hardship and anxiety that they have suffered.”