* Co fined for exposing clients to more risk than knew about
* CEO acknowledges company had fallen short
* Says confident had mended its ways since then
* Fine would have been higher but firm settled quickly
(Adds detail, company reaction)
By Chris Vellacott
LONDON, April 28 Fund manager Invesco Perpetual
has been fined 18.6 million pounds ($31.3 million) for exposing
clients to more risk than they knew about, the latest in a
series of setbacks for one of Britain's largest managers of
In a statement on Monday, Britain's financial regulator said
Invesco Perpetual had between May 2008 and November 2012
flouted rules on investment limits designed to minimise its
clients' exposure to risk, resulting in them losing money.
"The extent of these losses was 5 million pounds and prompt
compensation has been paid to the funds," the Financial Conduct
authority (FCA) said. "These losses could, however, have been
Earlier in April Invesco Perpetual - a unit of U.S.-listed
Invesco Ltd - lost mandates to run 7.7 billion pounds of
funds for wealth manager St James's Place, much of which
is following Invesco's best-known fund manager Neil Woodford who
is leaving to start a new venture.
Woodford first announced plans to leave the firm in October,
widely seen in the industry as a blow for Invesco given his
cult-like status among investors and ability to attract huge
flows of funds.
The FCA said the company - which it said ranked as the
largest retail investment manager in the UK - broke rules
designed to limit risk to investors 33 times and failed to
communicate clearly with clients how it was using derivatives.
The firm also incorrectly described the impact of using
derivatives in documentation for investors produced in 2012 and
failed to record trades on time, which meant they could have
been wrongly priced, the FCA added.
In a statement, Invesco Perpetual Chief Executive Mark
Armour acknowledged the company had fallen short but said he was
confident it had mended its ways since then.
"We are confident that our systems and controls are now
strong, effective and compliant with all applicable regulations
... In this instance, we clearly fell short of the high
standards we consistently strive to deliver," Armour said.
The FCA said Invesco Perpetual had agreed to settle quickly
and therefore qualified for a 30 percent discount on the fine,
which would otherwise have been 26.6 million pounds.
($1 = 0.5948 British Pounds)
(Editing by Huw Jones and David Holmes)