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FSA tells firm to stop trading after it fails to get PI cover

A Sussex IFA has been told by the FSA that his failure to get professional indemnity cover means his £250,000 business must stop trading.

The FSA has told Marshall Williams & Co it must cease regulated activities, preserve all documents and write to all clients saying the firm has stopped trading. The firm&#39s auditors, solicitors and an independent consultant had valued the 18-year-old business at £250,000 but say it is now worth a fraction of that figure.

Marshall Williams & Co has been unable to get PI cover despite never having a claim in 18 years trading and after applying to all insurers on the FSA&#39s list.

It must now apply to the FSA to vary the firm&#39s Part IV permission – the regulatory term for closing down business – or face enforcement action.

Director Ian Williams is accusing the FSA of piling the pressure on small IFAs just as solutions – such as a captive insurer for low-risk IFAs – are in sight.

Williams says: “Why is the FSA piling on the pressure just as solutions are appearing on the horizon?”

FSA spokeswoman Louise Buckley says: “There are ways we can help IFAs through this but at the end of the day we will take whatever action is necessary to protect consumers.”

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