£20,000 fine for The Underwriter chief executive who deceived FSA

The former chief executive of The Underwriter, Keith Rutter, has been fined £20,000 for failing to be “open and cooperative” with the FSA.

The FSA said in 2001 and 2002 when under the control of Rutter, The Underwriter bypassed its authorisation requirements.

According to the FSA, The Underwriter was obliged to abide by premium income limits (PILs) set for the years ending 1999, 2000, 2001, and 2002.

But, in 2001 and 2002, the firm took the decision to split insurance contracts and defer income into the following year, believing the practice to be acceptable.

The FSA, however, said this action contravened its rules.

FSA director of enforcement Andrew Procter said: “The Underwriter took steps that enabled the firms to circumvent a regulatory requirement set by the FSA.

“Despite regular discussions between the FSA and the firm, these steps were not mentioned by the firm. This meant that The Underwriter's reported premium income did not accurately reflect the underwriting risks to which it was committed. This is unacceptable and in breach of our principles."