The UK watchdog is investigating claims by savers who are facing heavy losses after an adviser at St James's Place sold investments in an unregulated firm owned by a schoolfriend, which then went bust, The Sunday Times reports.
Philip Cox allegedly used company emails and letterheaded paper to persuade some clients to put money into a start-up called Green World Innovations, which went into liquidation in October 2019, leaving up to 68 investors nursing losses of more than £3.3m. According to the paper, as many as 17 of them were SJP customers advised by Cox, who collectively invested £1.35m over five years.
Several former clients of Cox have spoken to the paper about their experience. Scared that their original investment would tank if they did not keep supporting the company, one couple put almost £500,000 into Green World over three years.
We are extremely concerned by these allegations in what are very distressing circumstances for some of Mr Cox's former clients"
Another client invested a £30,000 critical illness payout Cox helped her to secure, and now fears she may run out of money if her illness returns.
"SJP has refused to compensate its customers as it did not approve the investments — but the savers say they only handed over their money to Cox because of his relationship with SJP," The Sunday Times continues. It also claims the FCA has launched an investigation after receiving a complaint from one of the investors.
SJP tells the paper Cox acted without its consent and that his actions are not representative of its advisers, and that it will investigate fully. It adds: "We are extremely concerned by these allegations in what are very distressing circumstances for some of Mr Cox's former clients."
Cox worked for Grosvenor Financial in Warwickshire between 2008 and 2017. The firm started representing SJP in January 2009. Cox moved to another SJP representative firm, Davidson Pert Financial Associates, almost three years ago.
Individual holdings breach limits