AXA Wealth Services has been hit with a £1,802,000 fine by regulators "for failing to ensure it gave suitable investment advice to its customers."
The Financial Conduct Authority (FCA) investigated cases between September 2010 and April 2010 at branches of Clydesdale, Yorkshire Banks and West Bromwich Building Society.
AXA sold approximately 37,000 investment products to 26,000 retail customers through advisers at these locations. The FCA said that these customers "tended to have low levels of experience in investments and were typically in or nearing retirement" and that they invested £440 million with AXA.
Regulators found that AXA did not "confirm how much risk its customers were prepared to take with their investments and explain in clear terms the level of risk they would be taking" and failed to "ensure that customers could manage financially if their investment fell in value."
In addition to the fine, AXA has agreed with the FCA to contact all customers who may be affected by its failings and a third party will oversee a review of any issues identified as a result of this exercise. Any customer who suffered loss as a result will be fully compensated and those sold inappropriate products will be able to switch or withdraw their investment.