Four days after Royal & Sun Alliance announced it was to cut bonuses on with-profits endowment policies and pensions for the third time this year, a fine of £1.35 million has been imposed on them for pension mis-selling. The fine dwarfs their previous fine in 1997 of £225,000 and is way ahead of the highest fine of £650,000 which hit Prudential in October 2001.
R&SA were visited by the regulator in 2000 which unearthed 13,500 cases that had not been reviewed - almost 25% of the insurer's case load.
The Financial Services Authority is determined to ensure that consumers have their cases, for whatever the reasons, dealt with in a timely and efficient manner. R&SA is understood to be under very close scrutiny by the FSA as it attempts to restructure its financial position. T he firm announced plans to cut 1200 jobs and reported a loss of £319million, which consequently saw the share prices fall sharply.