The FSA has banned two insurance brokers for failing to protect client money and assets.
Shield Insurance Consultancy (Shield) director Delwyn Way has been fined £77,957 and banned from working in financial services for putting client money at risk by failing to ensure insurance premiums were passed onto insurers.
Griffiths McAlister Insurance Brokers (Griffiths McAlister) director Adrian Shillaker has been banned from working in financial services with immediate effect for knowingly transferring client money to Griffith McAlister's business account to fund its business expenses.
Shillaker also failed to ensure client money was managed in accordance with the FSA's client money rules, including failure to segregate client money from other funds.
The FSA, who has cancelled the permission of the firm, said Shillaker's failings left customers at risk of losing money.
The regulator said he avoided a fine after proving this would bring serious financial hardship. He has also taken steps to ensure money owed to customers is repaid.
The action taken against the two brokers comes as the FSA announced the establishment of a new unit to strengthen its existing capabilities in the area of client money and assets.
The unit consists of teams responsible for specialist supervision, policy, data analysis and risk management.
Earlier this week, the FSA fined Close Investments Ltd £98,000 for failing to properly protect and segregate client money. The fine came on the back of similar recent action against both J.P.Morgan Securities and investment manager and stockbroker Rowan Dartington.
"It is simply unacceptable that these two individuals have failed to ensure their clients have the appropriate protection in place and as a result we have taken firm action," says FSA director of enforcement and financial crime Margaret Cole.
"Firms must take their responsibilities to protect client's money and assets very seriously and we have clearly set out our expectations in this area.
"In particular, firms must not mis-use client money, they must keep it separate from all other funds in an appropriate trust account, and client money must not be rendered vulnerable to loss or reduction."
Speaking at Professional Adviser's conference
Equity release panel
Speaking at PA360
TISA's Peter Smith
Shone a light on 'closet trackers'