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£400k fine and £15m redress bill for Royal London

Royal London has been fined £400,000 by the PIA and ord-ered to pay

£15m in compensation to 65,000 customers for breaches relating to the

sale of investment products.

Royal London is now conducting a review of the past sales of its full

product range, including endowments, wholeof-life policies and savings

plans, and will provide further compensation where customers have been

disadvantaged.

The failings include not taking into account customers&#39 investment

objectives to ens-ure the product is suitable for them and not providing

reason-why letters.

It also failed to maintain an adequate system of compliance control and

did not monitor the conduct of its sales staff or ensure staff were

sufficiently trained and competent to give investment advice.

The fines relate to the period April 1996 to March 1999. Michael Pickard,

who was chief executive until April 1998, is now a non-executive director

at Equitable Life.

A PIA spokesman says: “Royal London has undertaken a radical and thorough

overhaul of the business since the identification of these failures by a

PIA visit in January 1999.”

Royal London group chief executive Mike Yardley says: “We have accepted

the PIA&#39s findings. More important, we have taken significant steps in

recent years to tighten our sales process and improve training. Where

customers have been disadvantaged, we will ensure they are compensated as

quickly as possible.”

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