FSA bans insurance broker for management failings 
FSA/PN049/2007
11 April 2007
The Financial Services Authority (FSA) has prohibited Alan Dennis Garlick, Director of Chapel Finance Limited (Chapel), from carrying out regulated activities for management failures and a lack of skill, care and diligence.
The FSA found that Mr Garlick failed to ensure that guaranteed asset protection policies (GAP) and payment protection policies (PPP), sold from 1 January 2005 to 20 April 2005, were underwritten. Chapel also held client money which it was not authorised to do and did not comply with the FSA's client money rules as a result.
Jonathan Phelan, head of retail enforcement at the FSA, said:
"Insurance brokers must make sure that policies are underwritten at all times. Having systems and controls in place is essential to ensure compliance with our rules and it is a management responsibility. Mr Garlick, as director of Chapel, should have overseen the implementation and maintenance of adequate systems.
"Firms should not hold client money without our authorisation to do so. There is no excuse for firms that fail to protect client money as we have provided tools to help them. Any failures we identify will be viewed seriously and we will take the appropriate action, which includes prohibition from the industry as shown in this case."
Chapel sold car finance and motor related insurance products. It went into administration in February 2006. After the firm ceased to do business, one of its creditors notified the FSA of its concern that some of the firm's insurance business was not underwritten. An FSA investigation showed that Chapel sold around 91 PPP and 134 GAP policies that were not underwritten between 1 January 2005 and 20 April 2005. Chapel also took clients' money, which it wasn't permitted to do, and failed to pass it on to its broker for underwriting the 240 PPP and 490 GAP policies it sold from January 2005 to February 2006.
FSA bans Chapel car finance 
