Aviva Investors is searching for a new global head of compliance following the departure of the specialist who was brought in to oversee controls amid a regulatory probe that resulted in a £17.6 million fine for the asset manager last year.
The £290 billion fund manager, the funds arm of the UK insurer, confirmed in a statement that Robin Mitchell has left, 17 months after having joined in January 2015. His arrival was publicly cited by Aviva Investors among the changes it had made to tighten its ship after it identified failings in its fixed income dealing controls in May 2013.
These issues resulted in the City regulator, the Financial Conduct Authority, fining Aviva Investors in February 2015. The asset manager also had to pump £132 million into eight funds to compensate for any potential losses.
A spokeswoman for Aviva Investors confirmed Mitchell left in May 2016 and that the search was underway for hiring a new global head of compliance. Financial News was unable to contact Mitchell. The spokeswoman said that David Young, who has held various compliance-related roles at Brewin Dolphin, future brokerage Newedge and Gartmore, joined in May to lead its compliance team on an interim basis.
She added that Andrew Fowler, a compliance specialist with more than 10 years of experience in the industry, most recently with AllianceBernstein, has also joined as head of compliance for Europe, Middle East and Africa. According to his LinkedIn page, Fowler left the US manager in April 2016.
The FCA imposed fine was for the firm’s failure to manage conflicts of interest when making fixed income trades. It reported in February 2015 that traders had been incentivised to favour certain funds over others due to the level of performance fees they would receive for making the trade.
The regulator also found “significant weaknesses” in the firm’s risk management framework which enabled traders to “cherry pick” trades that benefited from favourable price movements.
The fine was the seventh biggest handed down by the FCA during 2016. The regulator said that while the failings were “serious”, Aviva Investors’ actions to rectify the issue were “exceptional”.
At the time, Aviva chief executive Euan Munro, who joined the firm from Standard Life Investments in 2014, said that the firm had made “substantial changes” to its management team, and had also “fixed the issues, improved our systems and controls, to ensure no customers have been disadvantaged”.
In November 2015, the FCA banned and fined Aviva Investors trader Mothahir Miah £139,000 for exploiting the weaknesses in the firm’s trading systems and controls for the period from January 2010 until October 2012.