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Home > Investor News > Risky Investments Garner Warnings From FSA

Risky Investments Garner Warnings From FSA

Complex and often risky investments such as private placements, non-traded REITs and synthetic exchange traded funds (ETFs) have captured the attention of the Financial Services Authority, which is planning to issue “health warnings” on a number of these products – even possibly banning some.

The actions are part of a tougher stance the FSA is taking to protect consumers, according to an Aug. 31 article by Wealth Manager.

Margaret Cole, the interim managing director of FSA’s conduct business unit, is particularly concerned about complex structured products that both consumers and regulators might find hard to understand

Reportedly, the FSA plans to issue the health warnings on products that it views as posing dangers, as well as defer giving licenses if a company’s business model is dependent on what the agency deems as a novel product.

Moreover, the British government plans to give the FCA – a new form of the FSA to be created in 2013 – powers to ban products entirely, for a temporary period, with structured products hinted as a likely target.


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