The first person to be prosecuted by the Financial Services Authority (FSA) over falsifying an application for permission to sell financial products has been given a suspended sentence.

Simon Gray, a former mortgage adviser, was sentenced to 18 weeks in jail, suspended for 18 months, at City of Westminster Magistrates Court yesterday.

Gray, of Bury St Edmonds, Suffolk, had earlier pleaded guilty to five counts of providing misleading information to the FSA and four counts of using a false instrument, an offence under forgery and counterfeiting laws.

He was prosecuted by the FSA after the regulator discovered he had given false details in his application to register as a mortgage broker and used forged documents in a separate application to become a director of a mortgage advice business.

Gray was ordered to pay £750 towards the FSA’s costs and will be supervised by the probation service for 18 months.

Mortgage brokers and other financial services employees who advise members of the public cannot work without first receiving approval from the FSA. Part of the registration process requires applicants to demonstrate that they are “fit and proper” to hold their role and falsifying these applications is a criminal offence.

The FSA regulates the conduct of financial services workers with a combination of criminal and civil sanctions. After several years of relying on civil cases, which usually result in fines or suspensions, the regulator is increasingly turning to criminal prosecutions, which can lead to jail terms.

The FSA currently has three criminal prosecutions over alleged insider dealing before the courts.

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