Moorgate Insurance Agencies boss barred from Lloyd’s

Pensions Insight

An insurance broking director has been banned by the FSA for dishonestly taking premiums and client money from his company for his own use.

Derek Wright, who ran Moorgate Insurance Agencies in Romford, Essex from 1997, has been barred from all Lloyd’s premises and doing any insurance business at the firm.

Wright was disciplined by the Lloyd’s Disciplinary Tribunal in 2001 for conducting business in a discreditable manner.

The FSA said in a statement that Wright believed he was not being fairly remunerated, and dishonestly diverted premiums and client money from his firm for his own use.

Moorgate was authorised by the FSA from 2004 to 2008, during which time Wright acted as a director, despite never having been approved by the FSA to fulfil the regulated functions associated with the role.

The only person at Moorgate who was approved to do so was his wife Mary, however she had little to do with the firm on a day-to-day basis, said the FSA.

Wright was responsible for submitting the firm’s retail mediation activities returns to the FSA, but these indicated the firm’s capital resources were consistently below the level required by FSA rules, and also contained inaccuracies, according to the regulator.

In February 2007, Wright informed the FSA that the firm’s capital resources deficit would be rectified by a further share issue. But despite a copy of a Companies House form being submitted to the FSA purporting to show an allocation of shares to Wright, the annual returns submitted by the firm to Companies House later that year showed no new shareholdings.

The following year, the FSA asked Wright to prove that Moorgate’s creditors had been paid, and that debtors’ money had been collected.

He responded, according to the FSA, saying that another broking firm had taken over responsibility for collection and payment of premiums, a change which had occurred without the FSA’s knowledge or consent.

Following the FSA’s original decision notice issued on 23 February 2011, Wright referred the matter to the upper tribunal. In its response the tribunal found his actions working at Moorgate suggested he had learned little from his experience at Lloyd’s, said the FSA.

The tribunal found Wright had misled the FSA over who was carrying out functions at the firm, and that in addition to dishonesty he had a “cavalier” attitude to regulatory compliance.

The FSA’s head of retail enforcement Tom Spender said: “This case graphically illustrates the dishonesty and lack of integrity that some brokers will exercise if it suits their purposes. “Wright dishonestly sought to hide his past and rehabilitate himself by posing as someone authorised to carry out regulated functions for Moorgate, when he was not.

“The FSA will continue to take strong action whenever we see this type of conduct.”