A former St James's Place senior partner has been banned indefinitely by the UK regulator, and fined £300,000 for misleading investors.

A former St James's Place senior partner has been banned indefinitely by the Financial Conduct Authority, the UK regulator, and fined £300,000  for misleading investors.

Between 2010 and 2011 Peter Carron told 11 clients to invest £2.4 million ($3.9 million) in three companies which he ran without fully disclosing this fact to them. He ploughed their money into Primrose Associates, a mortgage broker; Evaluate Technologies, which provided an online system for sourcing mortgages; and Comment, a social networking business.

The clients lost £2.2 million when the companies went into liquidation between May and August 2010, the FCA said in a statement today.

St James's Place has since paid investors £1.9 million in compensation.

The FCA said that Carron lacks honesty and integrity and banned him from performing any function related to regulated activities in financial services.

"People go to advisors because they want expert help on how to make the most of their money. They are entitled to expect that their adviser will act in their best interests, not his own. Advisers should think very carefully and make clear and full disclosure if they are intending to advise clients to invest in ventures in which they have an interest." said Tracey McDermott, director of enforcement and financial crime.

Carron misled clients about the likely performance of their investments, by guaranteeing a return or providing inappropriate financial projections of future returns, the FCA said. He continued to reassure investors and advise them to invest even when he knew his companies were in financial difficulties.

He also led clients to believe that the investments were approved or endorsed by St James’s Place, which was not the case, the FCA said

“When the improper conduct was brought to the attention of St James’s Place we immediately commenced investigation and Mr Carron’s contract was terminated. All clients affected were made aware of the situation so their individual circumstances could be managed and compensated appropriately," a spokesperson for St James's Place told this publication.