The FCA has today fined Bluefin Insurance Services Limited (Bluefin) £4,023,800 for having inadequate systems and controls and failing to provide information to customers about its independence in a way that was “clear, fair and not misleading.”

The FCA says that it makes no criticism of other parts of Bluefin which, under AXA ownership, had a large and rapidly growing Financial Planning and wealth management operation which was sold off. Before the sell off Bluefin acquired a number of leading Financial Planning businesses.

Today Bluefin is one of the UK’s biggest insurance brokers with over 1400 staff in over 40 offices around the UK. It places over £500million of insurance premium business annually and claims to have “huge buying power in the market.”

The regulator says that between 9 March 2011 and 31 December 2014, Bluefin, which was wholly owned by the insurer AXA UK Plc during this time, held itself out to be ‘truly independent’ in the advice it provided and the insurers it recommended to customers.

However, the FCA says that Bluefin failed to implement adequate systems and controls to manage the conflict that arose from Bluefin’s ownership.

Bluefin’s independence was compromised, says the watchdog, by its culture which promoted business strategies, including a policy which focused on increasing the business placed with its parent company over treating customers fairly.

Bluefin brokers did not disclose this policy, so customers risked being misled into believing they were dealing with a broker who would conduct an unbiased search of the market.

Mark Steward, executive director of enforcement and market oversight, said:
“Insurance brokers must promote a culture in which they act in their customers’ best interests and provide them with the information they need to make an informed decision. This is central to the relationship between the industry and its customers.

“It is also unacceptable that firms hold themselves out as independent when they are not.”

Bluefin agreed to settle at an early stage of the investigation and received a 30% reduction in its overall fine. Without this discount the fine would have been £5,748,200.