Santander's British arm is being investigated by the Financial Services Authority (FSA) for possible breaches in the quality of its investment advice, industry sources told Reuters.

The FSA on Wednesday said it had referred one unnamed firm to its enforcement division for offering flawed investment advice to customers.

Santander declined to comment on whether it was the firm.

The enforcement action came after spot checks on the quality of advice available at six major lenders. A spokesman for Santander said of that review: "We are considering the findings in the context of the significant actions we took in 2012 to prepare for the post-RDR (retail distribution review) world."

(Reporting by Steve Slater, Kirstin Ridley and Matt Scuffham)