UPDATE 1-UK fines insurance broker over bribery, corruption risks

Thu Dec 19, 2013 4:38am EST

LONDON Dec 19 (Reuters) - Britain's regulator fined insurance broker JLT Specialty (JLTSL), a unit of Jardine Lloyd Thompson, over 1.8 million pounds ($2.95 million) for an "unacceptable" approach to bribery and corruption risks from overseas payments.

The Financial Conduct Authority (FCA) said on Thursday JLTSL failed to conduct proper due diligence before entering into relationships with partners in other countries who helped the broker secure new business between 2009 and 2012.

The regulator said that during this period, JLTSL received almost 20.7 million pounds in gross commission from business provided by so-called overseas introducers, and paid them over 11.7 million pounds in return.

"These failings are unacceptable given JLTSL actually had the checks in place to manage risk, but didn't use them effectively, despite being warned by the FCA that they needed to up their game," said Tracey McDermott, the FCA's head of enforcement and financial crime.

The FCA said JLTSL had failed to respond adequately to numerous warnings.

However, the regulator noted it had found no evidence to suggest JLTSL permitted or intended to permit any illicit payment or inducement to any overseas introducer in the period.

JLTSL said in a statement it had now put in place updated policies that have been confirmed by the FCA as being appropriate.

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