The Financial Conduct Authority (FCA) has fined Bluefin Insurance Services £4,023,800 for having inadequate systems and controls and failing to provide information to its customers about the company's independence.
Between 9 March 2011 and 31 December 2014, Bluefin, a large insurance broker which was wholly owned by the insurer AXA UK Plc during this time, held itself out to be ‘truly independent’ in the advice it provided and the insurers it recommended to customers.
However, Bluefin failed to implement adequate systems and controls to manage the conflict that arose from Bluefin’s ownership. Bluefin’s independence was compromised by its culture which promoted business strategies, including a policy which focused on increasing the business placed with its parent company, over treating customers fairly.
Bluefin brokers did not disclose this policy, so customers risked being misled into believing they were dealing with a broker who would conduct an unbiased search of the market.
Mark Steward, Executive Director of Enforcement and Market Oversight, said:
'Insurance brokers must promote a culture in which they act in their customers’ best interests and provide them with the information they need to make an informed decision. This is central to the relationship between the industry and its customers.
'It is also unacceptable that firms hold themselves out as independent when they are not.'
Bluefin agreed to settle at an early stage of the investigation and received a 30% reduction in their overall fine. Without this discount the fine would have been £5,748,200.
The FCA makes no criticism of any member of the AXA Group other than Bluefin.