Shares slump up to 25% in CPP after it warns FSA probe will affect profits in 2012
Credit card insurer CPP warned its profits would be ‘significantly’ lower than in 2011 because of an FSA probe over mis-selling of ID theft insurance.
The shares closed down 22p, or 16 per cent, at 117p amid fears of an earnings slump and compensation payouts.
Chief executive Paul Stobart, who has led the firm since October, said the duration and outcome of the investigation remained uncertain and that this inevitably had an impact on new sales in 2011, according to the Financial Times.
The FSA opened up an investigation earlier this year after becoming concerned that CPP’s identity theft products may have been mis-sold to customers.
Yorkshire-based CPP, which floated on the stock market last year, suspended all new sales of its identity protection product in March over allegations it may have overstated the risks of identity theft.
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