PIA attacks 614 firms for mis-selling transgression

THE WATCHDOG for the personal investment industry yesterday said he was "very disappointed" that 614 firms had appeared to fail to meet the December pensions mis-selling deadline.

Joe Palmer, chairman of the Personal Investment Authority (PIA), yesterday said the companies accounted for 4,604 cases - 2 per cent of all the most urgent cases.

The PIA required the firms it regulates to complete 90 per cent of their most urgent pension mis-selling cases - "priority one" cases - by the end of last year.

Most of the 614 firms, all independent financial advisers, appeared to have completed less than 30 per cent of their priority one cases, Mr Palmer said.

"Although they account for a relatively small number of cases, each and every investor deserves a quick and efficient conclusion to their case and should not be let down in this way," he said.

The PIA said it was investigating the apparent failures "with a view to commencing disciplinary action". The disciplinary action is expected to take the form of fines.

The news came as Norwich Union, the insurance group, said it was on track to complete virtually all 6,000 of its priority mis-selling cases by the end of April, in line with its regulatory target.

Norwich Union is among the companies unlikely to face PIA action. Richard Harvey, Norwich's chief executive, said: "We are confident we can achieve results which are satisfactory to the PIA".

The insurer yesterday also delivered a strong set of full year figures, its first since flotation in June.

On a like-for-like base, operating profit before tax rose 11 per cent to pounds 627m. The results - which were roughly line with City expectations - had little impact upon the shares, which closed 5p down on the day at 510p.

One analyst commented: "It was a solid set of figures. The results were very close to what we expected."

Norwich is to seek authority at its annual general meeting to buy back up to 10 per cent of its shares. However, Mr Harvey said the insurer had "no intention in the imminent future" of using this authority. He added it was simply "an option every company should have".

Mr Harvey declined to comment on whether Norwich, which is widely seen by sector watchers as a candidate for takeover, had received approaches from potential acquirers.

The Norwich chief said: "It would be inappropriate to comment on rumours. As far as acquisitions go, we've always been absolutely clear that Norwich Union regards itself as a positive acquirer who could play a useful role in consolidation." Norwich said it had sufficient spare capital to make smaller acquisitions.

Norwich announced a dividend per share of 7.75p. Its investors have seen their shares increase by about 50 per cent in value since the company converted last summer at a cost. Two key factors driving the share price rise are hopes of merger activity and the fact that many institutions are underweight in Norwich Union. More than 50 per cent of the company's shares are currently held by individuals.