FCA seeks £80m 'death bond' fines

One of them - Stewart Ford - has been given a fine of £75m, the largest such penalty ever imposed on an individual.

The Financial Conduct Authority (FCA) said the way the bonds were sold - by a company called Keydata - was "unclear, incorrect and misleading".

Some 37,000 people bought the bonds.

Investors, who bought the investments between 2005 and 2009, were incorrectly told that they were eligible for Isas.

Between them, those investors lost at least £330m, the value of the bonds involved. They are currently being refunded by the Financial Services Compensation Scheme (FSCS).

By buying the bonds, purchasers were investing in second-hand life insurance policies, which would pay out when the original owner died.

The policies were originally sold by citizens in the United States, who are allowed to cash them in.

But the FCA said the bonds were not suitable for ordinary private investors, because of the risk involved.

Tribunal

The FCA said the three men had also misled the previous City regulator, the Financial Services Authority (FSA), in relation to the performance of the investments.

Stewart Ford was the former chief executive of Keydata, which was dissolved in 2014.

The FCA said he had received £72.4m in fees and commissions on sales.

Mark Owen, the former sales director, was fined £4m. He received commissions worth £2.5m.

Peter Johnson, the former compliance officer, was fined £200,000.

All three have been banned from working in financial services ever again.

The men have appealed against their fines, and their case will be heard at a tribunal.