Release Date: 13th July 2016
To access the original FCA document, click here.
Summary
The Financial Conduct Authority (FCA) has fined Timothy Duncan Philip £60,000 and prohibited him from having direct responsibility for client and/or insurer money in any regulated activity. This action results from breaches of Statement of Principle 6 while he served as a Director at Towergate Underwriting Group Limited (TUGL) from 23 August 2010 to 29 June 2012.
Reasons for the Fine:
- Failure to Follow Procedures: Mr Philip instructed and/or approved withdrawals from TUGL’s central client and insurer money accounts without adhering to TUGL’s established processes. This caused inaccurate assessments of funds, resulting in client and insurer money calculations overstating resources by £5 million and £5.5 million, respectively.
- Neglect of Risks: He failed to identify and manage the risks created by his deviations from the established processes.
- Oversight Failures: Mr Philip did not ensure that the risks from these withdrawals were properly managed, leading to regulatory breaches.
Key Takeaways for Other Firms:
- Adhere to Established Processes: Ensure strict compliance with established procedures for handling client and insurer money.
- Risk Management: Identify and manage risks associated with any deviations from standard processes.
- Senior Management Responsibility: Senior managers must ensure their actions align with regulatory requirements and protect client and insurer funds.
- Regular Monitoring: Implement effective monitoring and reconciliation processes to ensure compliance with CASS rules and other regulatory standards.
- Training and Oversight: Provide adequate training for staff involved in handling client and insurer money, and maintain oversight to ensure compliance.
Conclusion:
The FCA’s action against Timothy Duncan Philip highlights the critical importance of adhering to regulatory requirements and maintaining robust internal controls for handling client and insurer money. Firms must ensure their senior managers are competent and capable of managing these responsibilities to avoid significant penalties and maintain the integrity of the financial system.
