Bill Raynes, one of the watchdog's practitioner directors, resigned after the watchdog suspended a firm of Independent Financial Advisers of which he is a director over a number of alleged regulatory breaches.
Mr Raynes had been elected to the PIA board in July 1996 by a constituency of IFAs. As practitioner director, his responsibility was to keep the PIA in touch with IFA's requirements.
His resignation comes just nine months after the departure from the PIA board of Ken Davy following the watchdog's decision to fine his firm, DBS Management, pounds 425,000 for its slowness in solving its pension mis-selling cases.
The PIA said that it had suspended Raynes, Hodder, Davison & Co, a Sheffield-based IFA, because it appeared that a majority of the firm's controllers "may not be fit and proper to act in that capacity".
The watchdog also said that the IFA could be in breach of rules that require firms to ensure they have enough financial resources to carry out their business.
A spokeswoman for the PIA declined to expand on the reasons for the suspension, but said that the watchdog was set to carry out an inquiry into the IFA's activities and that the suspension would be in place until the investigation ends.Reuse content