Network boss fined £10,500 by FSA
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The Financial Services Authority has fined David Head, director of Essex-based mortgage and insurance broker network FT Compliance Services, £10,500.
Head failed to properly supervise insurance brokers he knew had close links with a firm and individual previously disciplined by the FSA for payment protection insurance failings.
FTCS operated as a network and recruited brokers as appointed representatives. Head was solely responsible for ensuring FTCS and its ARs were compliant but he failed to put in place systems and controls to ensure that ARs made suitable recommendations.
Head therefore exposed customers to the risk of purchasing unsuitable PPI products.
While the number of sales in question was relatively small, the FSA’s investigation found that in cases where single premium PPI was sold ARs were not properly considering customers’ eligibility.
ARs also failed to consider whether medical conditions or existing cover made PPI unsuitable.
In its latest newsletter on financial crime the FSA warns that its focus on mortgage fraud will continue in the coming year. It says economic conditions have reduced lending but not fraud, and it plans to visit mortgage lenders.
In the newsletter the FSA states that its aim is to improve lenders’ systems and controls, and boost their ability to manage and report on the crime risks associated with increased business levels.
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