According to the FMA, Tower has carried out remediation and repaid over $11.7m to customers.<\/p>\n
The fine comes eight years after a settlement agreement was reached between Tower and the Commerce Commission in which Tower agreed to fix its policy system that had caused a historical issue, resulting in miscalculations.<\/p>\n
Justice Laura O\u2019Gorman said the FMA was \u201cjustifiably critical that the previous settlement was intended to ensure Tower sufficiently invested in and maintained adequate systems and processes to ensure any MPD is applied correctly\u201d.<\/p>\n
The FMA\u2019s head of enforcement Margot Gatland said Tower\u2019s issues stemmed from deficiencies in its systems.<\/p>\n
\u201cTower used the advertised MPDs to attract and retain customers, without having systems that could reliably deliver on the promised discount,\u201d Gatland said.<\/p>\n
\u201cThe FMA\u2019s statutory objective is to promote and facilitate the development of fair, efficient and transparent financial markets, and to promote the confident and informed participation of businesses, investors and consumers in financial markets.<\/p>\n
\u201cConfident participation in New Zealand\u2019s financial markets can only exist if an intrinsic level of market integrity exists. This is why we continue to respond to fair-dealing breaches like this.\u201d<\/p>\n
She acknowledged that Tower had self-reported the MPD issues, co-operated with the FMA\u2019s investigation, made admissions and carried out a comprehensive remediation programme.<\/p>\n
Tower chairman Michael Stiassny said the company had acted in good faith and fully acknowledged that mistakes were made.<\/p>\n
\u201cIt was pleasing that the court accepted Tower\u2019s explanation of how the MPD errors occurred, saying that Tower had acted responsibly to address the breaches and that it was not a situation of historic[al] system failures remaining unaddressed,\u201d Stiassny said.<\/p>\n
\u201cWe accept and regret the impact this has had on our customers and apologise unreservedly to those who were charged inaccurately.\u201d<\/p>\n
Tower said it had made significant investments in improving its systems and processes and is removing the multi-policy discount from its insurance offerings.<\/p>\n
Recent win<\/p>\n