The Financial Conduct Authority has fined insurance broker Bluefin Insurance Services Limited £4 million for having inadequate systems and controls.
In addition, the regulator has said that Bluefin failed to provide information to its customers about its independence in a way that was clear, fair and not misleading.
The company, which was wholly owned by AXA UK during the period between 9 March 2011 and 31 December 2014, failed to implement 'adequate systems and controls to manage the conflict that arose' from its ownership.
The City watchdog said that the company's independence was compromised by its culture which promoted business strategy over treating customers fairly. At the firm there was a policy that focused on increasing business placed with AXA.
Mark Steward, executive director of enforcement and market oversight, said: 'Insurance brokers must promote a culture in which they act in their customers’ best interests and provide them with the information they need to make an informed decision. This is central to the relationship between the industry and its customers.
'It is also unacceptable that firms hold themselves out as independent when they are not.'
Because Bluefin agreed to settle at an early stage of the investigation it received a 30% reduction in the overall fine. Otherwise it would have been £5.7 million.