Failure to point finger at Aviva culprits leaves lessons in doubt
Published 20/12/2012 | 05:00
ANOTHER day, another Central Bank fine for a financial institution. Yesterday, it was Aviva's turn to feel the wrath of the regulator, this time for failing to adequately control a share lending scheme it ran for a decade.
The €2.45m fine is one of the biggest penalties the Bank has imposed on a firm in recent years, and ranks up there with fines handed to the likes of Combined Insurance, Quinn Insurance and Alico Life.
The regulator's findings are damning. Aviva had no investment policy for stock lending worth the name. It did not set proper risk limits. Investment managers weren't monitored and, crucially, management did not receive regular updates on the firm's exposure. These are basic requirements for any trading operation.