A high-street insurance broker has been fined £770,000 for "serious failing" in its advised sales of single premium payment protection insurance (PPI).
Swinton Group automatically included PPI in its insurance quotes and, on policies that only cost £1.21, charged as much as £20 per month.
The FSA says the company made almost £8m from its PPI sales before it exited the market last year following FSA pressure.
Swinton has agreed to contact over 350,000 customers who paid for the insurance and offer a full refund. Its cooperation also meant its fine was reduced from a possible £1.1m.
"These were deliberate breaches," FSA director of retail enforcement and financial crime Margaret Cole says.
"Swinton was fully aware it should establish customers' needs for PPI before recommending it, yet nearly half a million policies were sold to customers who didn't necessarily require them. The firm clearly failed to treat its customers fairly."
In a statement today Swinton says: "The company did not deliberately set out to breach FSA rules or to disadvantage customers and acted in good faith in the development of its sales process which it believed was reasonable and proportionate for the low cost of the product. The total cost of the product was disclosed to customers and was in line with prices charged by other providers in the market for similar products. Swinton believes that the vast majority of its customers understood that the product was optional when offered to them and in fact, less than 50% of its eligible customers purchased the product."
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