The Financial Services Authority said it imposed the fine on the
Ancient Order of Foresters Friendly Society because the firm failed
to promote financial products to consumers in a way that was clear,
fair and not misleading.
It said Foresters neglected to ensure that promotion of two of
its products, 'Autumn Gold' and the 'TeddyTrust' child trust fund,
contained a fair and adequate description of the risks and
drawbacks of the product.
The FSA was concerned that Foresters, which has existed since
1834, had also described its 'Autumn Gold' whole of life insurance
policy as a funeral plan in one of its promotions, when it was not
a funeral plan.
The seriousness of Foresters' failings was made worse because
its target market was elderly consumers whom it did not make aware
should seek advice if in doubt about the suitability of the Autumn
Gold policy.
FSA Director of Enforcement Margaret Cole said: "Foresters put
consumers at risk despite warnings to firms from the FSA on
specific areas of financial promotions that needed improvement.
Ensuring that financial promotions are clear, fair and not
misleading is a responsibility firms should not take lightly and
other firms should take heed."
The promotions included TV commercials featuring actress
Stephanie Cole and DIY presenter Tommy Walsh. There were also
advertisements in magazines and newspapers as well as online
promotional material.
