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FCA bans and fines insurance broker £70k for retaining premiums

The FCA has banned an insurance broker and fined him £70,000 after he took £630,000 in premiums and used them to cover office expenses.

David Wren, the former chief executive of Chester-based insurance broker Astbury Wren & Company, has been banned from undertaking any regulated activity after the regulator found he failed to act with integrity.

Astbury Wren paid premiums it collected into a client account. As chief executive, Wren was solely responsible for transferring the commission the firm was entitled to into its office account.

However, the FCA found that between March 2009 and February 2012 Wren transferred an additional £630,000 into the office account and used it to cover office expenses rather than paying insurance premiums.

Astbury Wren ceased trading in February 2012, owing £1.4m to insurers in unpaid premiums.

Three customers had to pay their premiums again, totalling £9,021, or face the cancellation of their policies.  

Wren’s fine was reduced by 30 per cent, as he settled the case at the first opportunity. However, the FCA judged the failings to be so severe that it did not reduce the fine as a result of financial hardship.

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Comments

There are 3 comments at the moment, we would love to hear your opinion too.

  1. I fail to see the deterrent of this level of fine—The guy steals £630,000 and gets fined £70,000 which to me looks like a net profit of £560,000.
    Bonkers or what????

  2. Are the police not involved?

  3. We're all doomed!!!!! 3rd April 2014 at 4:48 pm

    The final notice (http://www.fca.org.uk/static/documents/final-notices/david-lloyd-wren.pdf) also states that “money transferred was used to pay the business expenses of Astbury Wren.” …but then goes on to say…”He knew the amount of money transferred was not calculated based on the amount of commission earned, but was instead transferred as required to fund Astbury Wren’s business expenses and to reduce Astbury Wren’s office account overdraft.”

    Guilty as charged then!!

    However, the notice then goes on to say…”Mr Wren has received no direct financial benefit from his breaches and so the Step 1 figure (part of the fine) is nil.”

    That’s why his fine was so low then!! Words fail me!!! Is the regulator on another planet?

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