A unit of Credit Suisse was fined by the U.K. markets regulator for promoting a product that garnered $1.35bn in investments and had about a 0% chance of reaching its maximum return.
Bloomberg News reports that the Financial Conduct Authority fined the bank $4.07m, the regulator said in a statement Monday. Yorkshire Building Society, which sold about 75% of the total amount invested in Credit Suisse’s Cliquet product, was told to pay $2.38m.
The firms must also contact customers who bought the product from November 2009 to June 2012 and give them the chance to exit it, without penalty or interest, the FCA said. Some 83,777 typically 'unsophisticated' investors, bought the savings product that was marketed as having a guaranteed minimum return and the potential for 'significantly more', according to the regulator. The probability of only achieving the guaranteed minimum return was 40 to 50% and close to 0% for the maximum, it said.
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