Financial regulator the FSA more or less admitted this week to making a bit fat fuss over next to nothing when it slapped a fine* of £2.2m (or £2.17 if you choose to believe Insurance Times) on state-owned insurance entities Direct Line and Churchill for dubious polishing.
Doubts arose over the reliableness of customer complaint files when apparent irregularities in files submitted to the regulator led to a ‘snap’ visit in June 2010 which found that more than half of 50 files sent to the FSA had been tampered with, buffed up a bit, artificially enhanced, etc. to dilute evidence of customer dissatisfaction and create a (suspiciously) full record complaints being followed up – extending to the bit of judicious signature forgery here and there, allegedly.
FSA acting director of enforcement and financial crime Tracey McDermott said that “the alterations did not impact on the FSA’s ability to do our job,” so the search for other culprits must continue there. “The significant penalty is however.” she continued, “intended to underscore to firms that it is of critical importance that material provided to the FSA must reflect the picture as it is – not as they might like it to be.”
Penalties intended to send out a message are a favoured technique for the FSA, recalling, perhaps, the unfortunate fate of poor Admiral Byng whose court martial and execution following the Battle of Minorca (1756) inspired Voltaire’s famous “pour encourager les autres” line.
Someone else concerned to get people’s attention – see countless other previous and concurrent stories – was the ubiquitous Jack Straw, who has now threatened motor insurers with having the whole dysfunctional business nationalised out of their sullied hands (is he still in government?) “I’m just trying to concentrate the minds of insurers,” he told the APPGIFS (All Party Parliamentary Group on Insurance and Financial Services).
Might as well herd cats.
* N.B. Just as colliding objects must slam, so fines must always now be slapped.
No responses yet