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NU in £500,000 cash rescue of Burns-Anderson

Norwich Union provided a £0.5m bail-out to IFA network Burns-Anderson last month after it had failed to meet FSA capital adequacy requirements for at least four months, Money Marketing can reveal.

It had been operating without adequate capital since at least the end of March and it was not until August that NU provided the cash. The network&#39s accounts reveal that at the end of March it failed to satisfy the regulator&#39s capital adequacy requirements, while chairman Steve Kelland said in a statement dated April 30 the matter was still unresolved.

As Burns-Anderson would have been in violation of FSA regulations during the period, it would have had to receive a waiver from the regulator to continue doing business.

Although the problems were mentioned in the company accounts, many members who do not receive a copy of the document are still unaware that the company was facing capital problems.

In the report, Kelland said: “Due to pensions reviews, FSAVC reviews and as a result of the introduction of services to directly registered firms the company no longer satisfies the FSA capital adequacy requirements.”

Burns-Anderson Independent Network chief executive Ian Parsons says: “As of April 30, we did not meet capital adequacy requirements. This was resolved subsequently and Burns Anderson has remained capitally adequate since as a result of the support of a major life company.”

NU spokesman Ian Beggs says: “We gave Burns-Anderson a £0.5m working capital injection in August.”

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