Following the publication of 'misleading' marketing literature on the security of one of its investment funds, Standard Life, a huge presence amongst pension providers, have been fined £2.45 million by the Financial Services Authority (FSA).

According to the FSA, 98,000 subscribers of the Pension Sterling Fund provided by Standard Life were misled into believing that the all their funds were "cash" when in truth it was mostly in the form of the much less secure "asset - backed" investments.

When told last January that their investments had seen a sudden drop by 5% which translates to an average of £900 each, the angry investors backed by financial authorities raised a huge indignant cry, which led to Standard Life compensating the members at a £103m cost to itself.

"The FSA takes the issue of misleading financial promotions very seriously and the fine announced today demonstrates our commitment to the principle of credible deterrence", verbalized Margaret Cole, the FSA's director of enforcement and financial crime.

The Edinburgh based giant pension provider, on its part, claimed to have a valuable lesson from the mistake.