The FSA has banned and fined an insurance broker £335,204 for retaining premiums to support the firm’s finances.
Donald Morgan Insurance Services partner Donald McKee Morgan has been banned alongside his wife Janet Morgan, the only other partner at DMIS.
An FSA investigation found that between October 2005 and July 2010, Donald Morgan deliberately kept insurance premiums from a number of clients which should have been paid to his network.
Morgan falsified monthly reports and manipulated the computer systems at DMIS to hide what he was doing. He used the money to pay staff salaries and fund his lifestyle. He told the FSA about his misconduct in August 2010 after realising he was not going to be able to repay the money he had misappropriated.
The financial penalty is made up of a punitive element of £112,700 and £222,504 to recoup the money Morgan gained through his misconduct.
Janet Morgan was banned because although she took no active part in the firm’s affairs, she failed to notice her partner’s fraudulent activity.