Unauthorised insurance agents banned as customers exposed to legal risk

Stephen Fryett and Richard Baines, directors of firms engaged in writing employers’ liability insurance, have been banned from performing regulatory activities for breaches of the general prohibition. Fryett held himself out as business development director of CIC Insurance SA (‘CIC Greece’) and acted as an introducer between underwriting agents in the UK and both this firm and the Centennial Insurance Company AVV of Costa Rica (‘CIC Costa Rica’). He represented that CIC Greece had been properly incorporated in Greece and authorised to transact insurance business in the UK and worked to persuade UK underwriting agents to generate contracts on behalf of CIC Greece and/or CIC Costa Rica. All the time, Fryett and Baines, a director of Insureyourshop.com Limited (‘IYS’), which issued CIC policies to UK businesses, knew that neither CIC company was authorised to write cover in accordance with the Employers’ Liability (Compulsory Insurance) Act 1969. Nor were they licensed in Greece, Costa Rica or anywhere else. In the period 1 April 2003 to 23 December 2003, when the FSA intervened to stop their activities in the UK, the firms had taken in total gross premium of approximately £4.5 million and purportedly put 1,700 customers on risk. Fryett benefited personally to the value of 5% of all premia paid to CIC Greece/Costa Rica by the underwriting agents.