UK watchdog fines mobile phone insurance broker $4.3 mln

London, July 3 Wed Jul 3, 2013 6:12am EDT

London, July 3 (Reuters) - The UK's financial regulator has slapped a 2.8 million pound ($4.3 million) fine on the company which administers mobile phone insurance sold by Phones 4u for poor handling of complaints.

The Financial Conduct Authority said in a statement on Wednesday an investigation had found significant failings in the way Policy Administration Services had handled complaints between June 2009 and September 2011.

PAS, which is responsible for customer relations, claims and complaints linked to insurance sold by mobile phone retailer Phones 4u, failed to "identify the root causes of recurring issues and put them right", the FCA said.

PAS has employed a third party to review its complaints processes following the FCA investigation and paid compensation to 1,438 customers.

The firm settled at an early stage of the investigation, qualifying for a 30 per cent discount. Without the discount the fine would have been 4 million pounds, the FCA said.

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