View more on these topics

Citisolutions grounds 2,000 staff

Citisolutions has been forced to stop 2,000 members of its salesforce doing business after failing to get sufficient training and register in time for FSA regulation of general insurance.

The company, which is a subsidiary of US banking giant Citigroup, has a combination of introducers, senior introducers and advisers. They primarily sell term insurance, life insurance and critical-illness cover provided by sister company CitiLife Financial but there are 14 advisers who are also authorised to act as tied agents for F&C Asset Manage-ment’s investment products and who are the only staff allowed to continue doing business.

Of the 2,000 staff, 1,300 are undergoing training and 700 are qualified and trained but not FSA-registered. The 14 advisers who are continuing to sell are the group’s only FPC-qualified staff.

The move was first revealed by MM’s sister title Finance Week. Staff were told by letter that they were no longer authorised for sales after a procedural slip-up meant that the group failed to act before the FSA took over regulation of the general insurance market.

FSA backlogs have been blamed for exacerbating the situation.

Citisolutions compliance director Ian Hammonds has just left the group.

The group’s training procedure entails a one-day intensive training course before introducers are sent out with senior introducers to learn in the field.

Citisolutions spokesman Adrian Russell declines to reveal how much the salesforce’s inactivity is likely to cost the group in lost commission nor when they will be back on the road.

He says: “We have written to them all, telling them not to sell until their registration process is complete and we suspect that others are in the same position.”

Which? principal money researcher Teresa Fritz says: “This is not the right source to buy these high-risk and complicated financial products. People should only see regulated financial advisers and ideally independent ones.”

Recommended

Only pre-1989 DB schemes can crack 1.5m limit

The Inland Revenue has confirmed that only pre-1989 defined-benefit scheme members will be allowed to build up pension pots in excess of the 1.5 lifetime limit without incurring penalties.

School’s out

After a flurry of activity a year ago on formulating a public education strategy on investment, all seems to have gone quiet.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment