A Scottish entrepreneur has been hit with the biggest ever fine imposed by Britain's financial watchdog.

 

Stewart Ford, founder of Keydata, which collapsed in 2009, has been ordered to pay £75m by the Financial Conduct Authority or FCA.

The regulator found that Mr Ford failed to act with integrity and also misled the its predecessor, the Financial Services Authority (FSA) relation to the performance of his investment products.

Mr Ford - and two colleagues Mark Owen and Peter Johnson, who have received smaller fines of £4m and £200,000 respectively - are understood to be appealing the decision to a tribunal.

Keydata went in to administration after selling so-called "death bonds", derivatives of second-hand life insurance policies of elderly Americans from companies based in Luxembourg called SLS and Lifemark.

The FCA, in a decision notice, said: "The FCA's view is that the three individuals permitted Keydata to continue to sell the Lifemark-backed products to retail investors when the individuals were aware that it was highly likely the products did not comply with regulations, that the financial promotions were unclear, incorrect and misleading, that the due diligence on the products was inadequate and that there were problems with the performance of the portfolio ultimately underlying the products. "

Mr Ford has always denied wrongdoing and has said he will file a civil action against the FCA and accountants PricewaterhouseCoopers seeking £650m in damages.

He said the old FSA had "knowingly exceeded its statutory authority in order to bring down Keydata as a blatant attempt to prove it could be effective after its disastrous handling of bank regulation in the lead-up to the 2008/9 financial crisis."