Abbey National has warned rival Royal London not to poach Scottish Provident staff for its new Edinburgh-based protection business.
ScotProv has also sent employees a memo outlining how joining the competitor could have legal implications and telling them if they are approached they must inform the head of personnel immediately.
ScotProv has been haemorrhaging staff since Abbey National took control in August, losing a number of high-profile names, including marketing director David Robinson and product marketing manager Roger Edwards.
Royal London-owned Scottish Life is understood to be starting up a new protection business and is already believed to have snapped up Robinson to head the company. More ScotProv staff are expected to move in the same direction, reportedly tempted by competitive packages.
Royal London came close to buying Scottish Provident, only just losing out to Abbey, which eventually bought the protection specialist for £1.8bn in October 2000.
Having reached advanced negotiations, Royal London had to sign agreements not to approach ScotProv staff.
Royal London has yet to respond to Abbey National's warning.
Industry insiders say Abbey managers are concerned about the number of staff who have left, having paid a high price for the business.