Swinton, one of Britain's biggest insurance brokers, was yesterday fined £770,000 for mis-selling payment protection insurance (PPI), and ordered to offer 350,000 customers a refund.
The Financial Services Authority, the financial watchdog, said that from December 2006 to March 2008, Swinton had assumed customers wanted to buy PPI in addition to the insurance they had asked the broker to arrange for them, routinely including the cost of the cover within the quote given without properly disclosing it.
In fact, the PPI that Swinton was selling cost just £1.21, but it charged an additional fee of £15 to £20 for the insurance. There was no attempt to establish whether customers wanted or needed the policy.
Margaret Cole, the FSA's director of retail enforcement, said: "These were deliberate breaches – Swinton was fully aware it should establish a customer's need for PPI before recommending it, yet nearly half a million policies were sold to customers who didn't necessarily require them."
Swinton, which was forced to pull out of the PPI market last year when the FSA began investigating the mis-selling, said it took the case "very seriously" and that it "apologises to any customer affected".
The FSA's action against Swinton is the latest in a string of penalties given to providers of PPI. The regulator is now seeking to ban sales of the cover alongside other financial products.Reuse content