Friends Provident
Company: Friends Provident
Fine Amount: £675,000
Date: 17th December 2003
Friends Provident Life and Pensions Limited was fined £675,000 after failures in its mortgage endowment claims procedures were identified by the FSA.
The fine related to complaints processed during the period of March 2000 and and February 2003, totalling 21,788 individual complaints. Of these, approximately 5,500 were rejected, and the FSA said that some of these rejections may have been incorrect as the complaints procedures were ‘inherently not fair and biased against customers’.
Amongst the procedural failings the FSA identified, it was found that the company was too ready to dismiss claims through lack of documentary evidence.
Also, assumptions were made that if the customer already held an existing endowment or other investment, then they understood the risks involved, and that Friends Provident’s advisers needn’t have emphasised them again.
The FSA said that the failures were ’significantly mitigated’ by the co-operation of the company during the investigation, and the introduction of new procedures to prevent the failures from arising again.