The FCA came down on the broker last year as it breached Principle 11 and failed to meet the suitability threshold
Devon-based broker – Perry Prowse Insurance Consultants Ltd (PPICL) has entered liquidation after it went into run-off last year.
This comes four months after the FCA removed its permission to broker insurance contracts.
This was effective from the 16 January. The Corporate Voluntary Arrangement (CVA) was completed earlier this month, but specific arrangements are to be made available soon.
On 10 January an asset requirement was imposed on the broker that required it not to dispose, deal with or diminish the value of any of the assets or any client funds or monies that it holds in the UK or elsewhere, without the prior written consent of the authority.
All related questions are now being handled by the official receiver.
Those that have an insurance contract with a UK insurer that was arranged by Perry Prowse have been advised to contact their insurer directly for further information on whether the policy is still valid.
The FCA warned the broker in September last year after it breached a principle and failed to satisfy the suitability threshold condition leading the regulator to vary the Part 4A permission for the broker.
This principle states that “a firm must deal with its regulators in an open and cooperative way and must disclose to FCA appropriately anything relating to the firm which that regulator would reasonably expect notice”.
“The reason for this action is because the firm breached Principle 11 (Relations with regulators) and failed to satisfy the suitability threshold condition from 19 February 2019 onwards. As a consequence of this action, PPICL’s Part 4A permission no longer includes the permission to conduct any regulated activities,” the FCA said.
This threshold condition represents the minimum conditions for which the FCA is responsible, a firm is required to continually satisfy this in order to be given and retain a Part 4A permission.
The broker stopped taking on new business in September but was still authorised and therefore had to continue to meet FCA standards in dealing with its customers. It was also asked to meet requirements or restrictions placed on financial services activities that it can operate – these can include suspensions.
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