UK regulator fines Dixons Carphone for mis-selling insurance

A British financial watchdog imposed a fine of about £29 million on Dixons Carphone on Wednesday for mis-selling its Geek Squad phone insurance and technical support service.

The Financial Conduct Authority (FCA) said the company's Carphone Warehouse did not give its staff the right training to give proper advice to customers purchasing the service and were trained to recommend it to customers who already had cover.

“Carphone Warehouse sales staff were trained in ‘spin selling’, where the focus was on persuading customers to purchase Geek Squad and on selling the features of the product,” the FCA said.The company also failed to properly investigate and fairly consider customer complaints about the product, the watchdog said.

Merged

Carphone Warehouse, Britain’s biggest mobile phone seller, merged with electricals retailer Dixons in 2014.

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The Geek Squad mobile insurance program, backed by Aviva Plc , covers phone damage and theft protection. The service was recently rebranded as Team Knowhow.

The investigation into the selling processes of Geek Squad was between December 2008 and June 2015 and the FCA imposed a discounted fine as Dixons had accepted the regulator’s findings, the regulator and the company said in separate statements.

Dixons Carphone accepted that its practices “fell short” in the past and it has made significant improvements since then, Dixons said. – Reuters