Mis-selling leads to £6m fine for Sesame

Sesame clients were among tens of thousands who lost out when investment firm Keydata – which used customer cash to buy bonds funding the purchase of bundles of US life insurance policies – collapsed in 2009.

The Financial Conduct Authority fined Sesame for its advice in relation to Keydata products, as well as wider problems in its systems. It found failures in ensuring suitable advice was given to Sesame’s customers and in the way its appointed representatives (ARs) were overseen by the company, even after the collapse of Keydata.

Sesame, which has an office in Huddersfield where it employs 140 people, is one of a number of companies that has had to compensate UK customers who were faced with the loss of £450m when Keydata went bust.

Between July 2005 and June 2009, Sesame advised 426 customers to invest more than £6.1m in Keydata products. The FCA found the vast majority were mis-sold. Sesame’s fine was reduced by 30 per cent from £8.6m after it agreed to settle the case at an early stage of the investigation.

Sesame CEO George Higginson said: “We regret these past issues and, in co-operation with the FCA, have undertaken an immediate past business review to ensure any customers who received unsuitable advice on Keydata Products have been compensated.”