The City watchdog has fined Santander UK £1.5m for failing to make it clear to investors who bought its structured investment products whether they were covered by the Financial Services Compensation Scheme.
The bank sold £2.7bn worth of the investments, which generally offer superior returns based on the increase in value of underlying assets such as the stock market, property or bonds.
The FSA said yesterday that although Santander received queries from its customers asking if they were covered by the compensation scheme following the financial crisis in 2008 it did not clarify the position until 2010.
That meant literature was potentially misleading and staff at the UK bank had not been fully briefed as to what they could say to potential investors. During that time Santander sold 178,000 of this type of investment and significantly, the FSA said, it sold £1.2bn after June 2009, when it had concluded the cover for two products, Guaranteed Capital Plus and the Guaranteed Growth Plan, was limited.
The FSA said there had been no mis-selling and no one had lost money. But Tracey McDermott, pictured, acting director of enforcement, added: "Considering that sales of these products took place between 2008 and 2009, a time of financial uncertainty, Santander should have moved more quickly to confirm under which circumstances FSCS cover would be available."
The bank said: "Santander is disappointed with the outcome and has registered its opposition to the FSA's findings. but we will not challenge the decision or the fine."Reuse content