Ex-EJ adviser files complaint against FSA over Towry

A former Edward Jones adviser has filed an official complaint against the Financial Services Authority (FSA), accusing it of poorly regulating Towry Law.

In a letter to the FSA dated 6 September 2011, seen by IFAOnline, Jason Levett, now a stockbroker and adviser at McLaughlan Hook, accuses the FSA of failing to act on multiple complaints about Towry's conduct.

"There has been no evidence, following exhaustive referrals of information to the regulatory department overseeing Towry EJ, that the regulatory department has delivered any improvement in service and addressed any of the issues raised," Levett writes.

Towry bought advisory firm Edward Jones in October 2009 but the takeover was not a smooth one. Clients complained last year that Towry delayed the transfer of client money from EJ and the payment of dividends on shares.

Levett claims the FSA was not aware Towry did not have discretionary authority on the accounts it bought from EJ.

He says clients from EJ had asked for the investments in their accounts to be transferred to Towry's accounts in-specie.

However, Towry planned to sell the assets in those accounts and transferred cash into clients' new accounts, Levett alleges.

This sale of assets, which eventually did not take place, would have been a discretionary action, he says, for which Towry did not have the authority.

"The FSA team had no idea Towry had bought a non-discretionary book from EJ over a year after it had happened," Levett said. He claims he brought Towry's non-discretionary terms of business on these accounts to the FSA's attention himself, preventing the asset sales.

Levett says he believes the Financial Ombudsman Service (FOS) has evidence of Towry carrying out discretionary activity without the appropriate authority elsewhere.

The letter also details other complaints against the FSA. Levett claims the regulator has failed to reply to letters of complaints from Treating Customers Shabbily, a group campaigning against Towry after the EJ takeover.

Levett says the FSA's Julian Adams, director of insurance, has refused to meet him and Kent MP Greg Clark to discuss complaints about Towry.

An FSA spokesperson said the regulator could not commment on ongoing complaints.

A Towry spokesperson said the firm could not comment on correspondence between third parties.