FSA dishes out £35,000 share-tipping fine

A PENNY share-tipping magazine has been fined £ 35,000 by the City watchdog for making misleading claims about the potential of company shares.

The Financial Services Authority said Highbury Financial Services, which produces Focus magazine, had exaggerated companies' prospects in its advert 'The 25 shares most likely to double in 2004'.

The promotion, which appeared in the Sunday Telegraph, Mail on Sunday and Investors' Chronicle, was deemed to be unrealistic and unbalanced by the FSA.

Director of retail themes Anna Bradley said: 'All financial promotions must be clear, fair and not misleading and firms must not make false statements in their marketing material.

Potential customers must be able to discern the key risks of an investment, as well as its benefits.

'All firms, whether large or small, need to ensure they have appropriate systems and controls in place to meet FSA regulations.'

The firm had made false statements about receiving 'secret tip-offs' and information from a 'panel of experts' regarding the highlighted shares.

The FSA said it didn't have controls in place to ensure the compliance officer was appropriately supervised and was competent in approving financial promotions.

The promotion was the latest to be identified by the FSA's financial promotions and monitoring team, which has so far taken action against AXA Sun-Life, Hemscott and Cantor Index.

The regulator warned last week that the promotion of financial products is one of its key priorities for the coming year.