The UK regulator has banned a broker from working in financial services and imposed a fine after an investigation found he used client premiums to pay debts instead of passing the funds to insurers. 

Financial Conduct Authority joint head of enforcement and market oversight Therese Chambers says customers trusted Martin Sarl to keep their money safe and to secure the cover they needed. 

“Instead, he helped himself to prop up his business and personal finances. He compounded this by lying to his customers,” she said. “This left many people at risk of being unable to make a claim should they have needed to. It is right that Mr Sarl should be banned from the industry.” 

Mr Sarl, the sole director of Perry Prowse (Insurance Consultants), failed to pass on premiums between November 7 2017 and October 24 2019, and used the funds to pay personal debt and that of the business, the FCA says. 

When questioned by customers, Mr Sarl hid the truth, including blaming a false “IT glitch”. In at least one instance a customer had a claim rejected because cover wasn’t in place. 

The FCA imposed a £5021 ($9741) penalty, reflecting the financial benefit derived directly from the breaches. The penalty was reduced from £63,600 ($123,392) because Mr Sarl provided evidence that the higher sum would cause him serious financial hardship.

The regulator took supervisory action against Perry Prowse (Insurance Consultants) in 2019 and the business entered liquidation on January 16 2020. 

The customer whose claim was refused because they did not have insurance in place was later reimbursed through the Financial Services Compensation Scheme.