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Director defrauds over £900,000 from customers

The insurance company, My Cover Ltd, was left with liabilities of over £1.5m and assets of under £13,000

7 December 2015

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The former director of the insurance company, My Cover Ltd, has received an 11-year directorship ban for 'causing the company to miss-sell [over] 11,000 insurance policies'.

David Stuart Pitcon of Bognor Regis, West Sussex, born 21 December 1986, sold insurance policies that were not underwritten by an insurer and without authorisation from the Financial Conduct Authority (FCA).

By the time the company was liquidated in January 2014, My Cover Ltd had racked up estimated liabilities in excess of £1.5m, and only had assets of £12,500.

The chief investigator of the Insolvency Service, Cheryl Lambert, commented: 'Mr Picton caused My Cover Ltd to mis-sell 11,162 insurance policies to members of the public who were told that an underwriter was in place. These people have lost a total of £987k. Taking action against Mr Picton is a warning to directors to take their duties seriously and to protect their customer's interests.

My Cover Ltd began trading in August 2011, selling underwritten policies for insurance of domestic items, as it was an authorised representative of a principal.

This was the case until 'around 31 March 2013', when the underwriter withdrew its underwriting facility from My Cover Ltd.

It was after this period that Pitcon began to renew and sell new policies without an underwriter and while in breach of FCA requirements. He falsely told policy holders that their policies were being underwritten.

David Stuart Pitcon's disqualification order will prevent him from acting as a director of a company, be a receiver of a company's property, or take part (in any way) in the formation or promotion of a company or limited liability partnership.

Chief investigator Lambert added: 'Directors who breach regulations and cause the public to lose money can expect to be investigated by the Insolvency Service and enforcement action taken to remove them from the market place.'

 

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Tax & Wealth structuring