FSA fines HSBC record £10.5m for mis-selling to elderly

The FSA has fined HSBC £10.5m for inappropriate investment advice provided by one of its subsidiaries, NHFA Limited (NHFA), to elderly customers.

It is the largest ever retail fine issued by the regulator and HSBC estimates that the amount of compensation to be paid to NHFA customers will be approximately £29.3m. Between 2005 and 2010, NHFA advised 2,485 customers to invest in asset-backed investment products, typically investment bonds, to fund long-term care costs for elderly customers. The products, which are typically recommended for a period of five years, were sold to individuals entering, or already in, long-term care and in many cases these elderly customers were reliant on the investments to pay for their care. Howe...