HBOS was guilty of it, and now Bradford & Bingley is committing the same sin.

In the prospectus setting out its revised rights issue yesterday, B&B omits to explain to shareholders they might be able to buy the shares in the market for considerably less than the 55p offer price.

B&B shares closed at 47.5p and have been as low as 35p.

This is shabby. Many of B&B's one million small shareholders are stock market innocents. They own the shares because of the former building society's demutualisation.

They don't read the financial pages, and may well sign up for shares at a higher than necessary price. Almost all of them are customers of B&B and are owed a duty of care. A prominent warning is the least they should expect.

The Financial Services Authority is turning a blind eye to this, saying the listing rules are not being breached. This is not good enough. It makes the listing rules in the first place.

FSA supervisors deserve credit for the muscular way they coralled City institutions into sub-underwriting the reworked B&B rights issue.

But their eagerness to foster stability by making the rescue a success should not be at the expense of naive investors being overcharged.

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