The Financial Services Authority has imposed one among its biggest ever fines for an individual and has banned five individuals for insurance fraud.
Andrew Jeffery of Jeffery Flanders (Consulting) has been banned and fined 150,000 for “recklessly” unable to executed health insurance policies appropriately or in anyway, despite collecting payment from customers. Consequently he exposed customers to risks for instance being without adequate household or motor insurance C particularly serious as much in the customers were elderly or vulnerable.
Jeffery also forged documentation and correspondence, potentially to mislead insurance carriers, and obstructed the the area watchdog’s investigation by unable to report changes to your firm’s contact information, along with not providing documents or attending meetings in the request from the FSA.
The four others banned by the regulator were a part of Orion Direct and/or Peppercom and were reported towards FSA through its whistle-blowing line. Barrie Duncan Aspden has been banned from performing any regulated role in financial services for acting dishonestly and without integrity, as well as knowingly using around 300,000 of Orion client money to invest in enhancing Hit the Pepper, a web based motor insurance site, which traded as Peppercom.
His actions meant several hundred customers of Orion were also put liable to being uninsured as their premiums were misused, although FSA today said customers were unaffected. Former Orion/Peppercom customers can call the FSA’s consumer helpline on 0845 606 1234 should they remain concerned.
Having been turned bankrupt and unable to obtain approved-person status, Aspden appointed three directors at Orion and Peppercom, including two relatives and a family friend. These three directors lacked the competence and skills to perform their roles, which enabled Aspden to operate the organization without worrying about relevant FSA approval.
As a result, Aspden’s wife Melanie and Gaenor Clayton, his sister-in-law, have been banned C and could have been fined 35,000 each even so the FSA accepted on the list of subsequently suffered “financial hardship”.
Paul Willment, a director and non-executive director of Orion and Peppercom, was fined 50,000 for failures in competence and capability. Willment rarely attended Orion’s offices, did not have any active involvement while in the management of this business and delegated his roles and duties to Barrie Aspden. The FSA said Willment was aware Aspden transferred 300,000 of his customers’ money, but couldn’t challenge him regarding this, allowing Aspden to commit insurance fraud.
The FSA claimed it is dedicated to removing from the industry anyone commits insurance fraud or fails to to become self-sufficient to circumvent it. Jeffery’s 150,000 penalty follows a 294,500 fine dealt to John Charalambous of TFA, an authorised mortgage and general insurance intermediary in Sidcup, Kent in June, as well as 77,957 penalty given out to Delwyn Arthur Means of Shield Insurance Consultancy, also in June.
Margaret Cole, director of enforcement and financial crime along at the FSA, said: “These five individuals acted with complete disregard for that interests with their customers plus the FSA’s regulatory requirements. Individuals holding a substantial influence function role, such as that of director, must act with integrity along with with all the skill, care and diligence necessary to manage effectively the firms for the purpose they can be responsible.”
Since a sluggish start in 2010, the FSA has banned accurately everytime 14 individuals for failings with regards to insurance businesses, with fines totalling over 500,000. The watchdog added that the quantity of insurance fraud cases has “really picked up” in past times year as smaller brokers have struggled during the wake from the recession. Due to this fact, it said its whistle-blowing line was proving popular.
