Rathbones is set to lose out on hundreds of millions of pounds of inflows after it suspended contributions from thousands of customers following an independent investigation into its business amid concerns from the Financial Conduct Authority.

The review into the company, known as a skilled person review, uncovered compliance shortcomings in its UK wealth management business, following engagement with the financial watchdog.

Rathbones said it will undertake a two year remediation programme addressing the recommendations in the review, and will stop taking on new enhanced due diligence clients, the FTSE 250 group’s high-risk clients, for the next year, a major blow to the firm’s relationships with its most valuable customers.

Gross inflows from these clients totalled roughly £370m in the last year.

Meanwhile, inflows into general investment accounts from around 4,700 of these clients will also be paused, which account for around £530m in gross inflows.

These actions are expected to rack up costs of £60m, but the shareholder dividend will remain unchanged while the group’s £20m share buyback programme will also begin shortly.

Rathbones will also cease charging investment management fees on cash balances within discretionary portfolios from July 1, damaging pre-tax profit by an estimated £9m this year.

Jonathan Sorrell, Chief Executive Officer, said: “We are committed to operating to the highest standards on behalf of our clients.

“The work we are undertaking will support and accelerate our vision to be the best wealth manager in the UK, by far. Our strategy is unchanged and we continue to make strong progress against the plan set out in February. I am grateful for the constructive engagement with the FCA, and the continued trust of our clients as we implement these improvements.”