Aviva fined €2.45m for regulation breaches

Aviva fined €2.45m for regulation breaches

Aviva Insurance has been fined a total of €2.45m for breaches of regulations.

Two fines of €1.225m respectively relate to Aviva Insurance and Aviva Life and Pensions, Ireland.

The Central Bank said the penalties imposed reflect the seriousness with which it views breaches of regulatory requirements - that are designed to ensure assets are properly managed and that life assurance policy holders are protected.

It also said both cases show evidence of serious inadequacies in Aviva's systems and control in relation to stock lending.

However, Aviva co-operated in both instances and settled at an early stage.

The Central Bank of Ireland’s Fiona Muldoon, director of credit institutions and insurance supervision and Peter Oakes, director of enforcement, issued a joint comment stating: “Where a firm outsources investment activity, it must ensure that it has adequate investment policies, procedures and quantitative parameters to manage that investment activity in a way that is appropriate to the firm’s balance sheet, and that it has sufficient information to allow it to properly monitor and control that activity.

“It is inadequate and unacceptable for firms to rely on group controls or group limits.

“The Central Bank reminds firms that they remain responsible for all regulatory obligations notwithstanding any reliance upon group controls or group limits.

“The pursuit of enforcement actions in respect of systems and controls failings is a Central Bank Enforcement Priority for 2012.

“The Central Bank has previously stated that where serious breaches of these regulatory requirements occur, regulated entities and their management can expect vigorous investigation and follow-up by the Central Bank.

“Where the actions of a firm undermine the Central Bank’s achievement of its statutory objectives, the firm should expect that enforcement action will follow, especially where the breach falls within our stated Enforcement Priorities.”

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