Context
Court papers / a Court decision has been published In The High Court Of Justice Business And Property Courts Of England And Wales Business List (Chd) in relation to two former Directors of Ambon Brokers Limited, formerly known as AFL Insurance Brokers Limited (AFL). Two if the former Directors, Alec Finch and Robert Finch, have been ordered to pay £6.2m in costs and reparations following findings of fraud and misrepresentations in the period running up to their sale of the business. These issues significantly involved the use of client money (in the region of £3.5m) over an extended period of years to shore up the performance and finances of the business.
Key points to note
- Former AFL owner Alec Finch and his son Bob Finch, former AFL CEO, were found to have painted a “false picture” of the wholesale broker’s financial position prior to the 2017 sale of a 58% stake in the business to Next Generation Holdings Limited (NGHL).
- At time of discovery, there was a £3.5 million client money hole that both Finches were aware of and at least in part responsible for, the judge found. Further, it was found that a list of debtors provided prior to the sale had overstated sums owed to AFL.
- This case will, no doubt, focus the FCA’s minds again on the insurance distribution sector and the protection of client money.
Next actions
None – for information and awareness.