Life insurance company fined

Mon, 07 Jan 2008

The Financial Services Authority (FSA) has fined Norwich Union Life £1.26 million for leaving their customers exposed to the risk of fraud . The life insurance company was hit with the fine due to not putting effective systems in place to protect customer identity. The failure led to many frauds against Norwich Union life customers, according to insurance news.

Cunning fraudsters used publicly available information to impersonate customers and request the surrender of policies, adding up to £3.3 million. The FSA indicated that Norwich Union Life did not adequately assess the risk, and left their customers open to identity theft .

Director of enforcement at the FSA, Margaret Cole, reportedly commented: "Norwich Union Life let down its customers by not taking reasonable steps to keep their personal and financial information safe and secure. It is vital that firms have robust systems and controls in place to make sure that customers' details do not fall into the wrong hands. Firms must also frequently review their controls to tackle the growing threat of identity theft. This fine is a clear message that the FSA takes information security seriously and requires that firms do so too."
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