THE City watchdog last week fined a South Queensferry-based financial adviser £60,000 for selling clients unsuitable investments that put them at risk of losses.
Patrick Francis O’Donnell, sole director of P3 Wealth Management, was also banned by the Financial Services Authority (FSA) from carrying out regulated activities after advising clients to invest in non-mainstream vehicles that were “clearly unsuitable”.
The FSA said O’Donnell, who has been in the business for more than 20 years, according to his website, had advised 57 of his clients to put money in unregulated collective investment schemes (UCIS). They included a fork-lift driver and his wife who invested their whole pension fund in such schemes, which the FSA said should only be promoted to sophisticated investors and “high-net worth” individuals.
O’Donnell “may have honestly and sincerely believed” he was doing his best for his clients, said the FSA, but was found to have recommended that many of them invest almost all of their money into illiquid, complex and higher risk investments.
Tom Spender, head of retail enforcement at the FSA, said: “O’Donnell had absolutely no understanding of the regulatory restrictions in place which prohibit advisers from selling UCIS to the vast majority of UK retail investors. He also completely failed to make recommendations that were suitable for his clients’ individual needs and circumstances.”
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Print this pageStocks higher on housing but Europe worries linger - Yahoo Finance
NEW YORK (AP) -- Hopes that the U.S. housing market is starting to recover and the economy is on the mend sent stocks higher on Wall Street.
But the gains are being constricted from continuing worries that Greece's political deadlock could fracture the European Union and roil global markets.
The Dow Jones industrial average rose 75 points Wednesday to 12,707. The Standard & Poor's 500 added nine points to 1,340. The Nasdaq composite rose 15 points to 2,908.
Home builder stocks rose after the Commerce Department said builders started work on new homes at an annual pace of 717,000 last month, 2.6 percent more than in March. It was a heartening sign for the beleaguered housing market, which seems to be forming a bottom and starting to recover. Construction rose for both single-family homes and apartments.
Target Corp. rose after a strong earnings report. Target said revenue at stores opened at least a year rose 5.3 percent, the strongest performance in six years for that period. Target's results illustrate that Americans are beginning to spend cautiously as economic uncertainty persists. Though the job market is still shaky, falling gas prices have given shoppers hope.
As signs of a global economic slowdown persist, prices of commodities have come off highs. Oil prices continued their march downwards from $105 in the beginning of the month to $93. Crude oil prices were down $1 on Wednesday. Gold prices fell $18 to $1539, the lowest level since December.
In Europe, a potentially chaotic situation was developing in Greece, where power-sharing talks collapsed Tuesday and new elections were called for next month. There is already concern in other European countries about how a possible Greek exit from the euro would affect the rest of the continent.
On Wednesday, Spain's prime minister warned that the country, which is trembling under a 24.4 percent unemployment rate, could be locked out of international markets due to problems in the EU.
"Right now there is a serious risk that (investors) will not lend us money or they will do so at an astronomical rate," Mariano Rajoy told Spanish lawmakers.
Financial pressures extend well beyond Europe too. The Indian rupee hit a new all-time low against the dollar with investors increasingly seeking a safe place to put their money. The rupee sank to 54.44 against the dollar Wednesday, surpassing the prior low of 54.39 on December 15.
Among other stocks making big moves:
— JC Penney plunged 14 percent, the most in the S&P 500 index, after the retailer reported a bigger-than-expected first-quarter loss. Sales plummeted as shoppers are rejecting their new pricing plan.
— Abercrombie & Fitch fell 11 percent after reporting that its first-quarter net income shrank 88 percent because of higher costs and declining sales in established stores and in Europe.
— General Electric rose 3.6 percent, the most of the 30 stocks in the Dow, after the company said its finance unit will pay a special dividend of $4.5 billion to the parent company this year. It had suspended the payments in 2009 during a freeze in credit markets.
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