Norwich Union Fined $2.54 Billion
British insurance company Norwich Union was fined 1.26 million pounds (1.76 million euros; $2.54 million) on Monday for a data-protection failure that allowed criminals to cash dozens of policies held by customers.
Fraudsters gained access to the company's databases and cashed 74 policies worth 3.3 million pounds (4.6 million euros; $6.7 million), the Financial Services Authority said.
"Norwich Union Life let down its customers by not taking reasonable steps to keep their personal and financial information safe and secure," said Margaret Cole, the enforcement director of the Financial Services Authority.
Norwich Union, a unit of Aviva, said all of the canceled policies had been fully reinstated, and 11 people had been arrested on suspicion of carrying out the fraud.
Anti-fraud measures have been updated following an independent review of the company's operations, it said.
"Whilst the number of customers affected is very small compared to the number of policies we manage overall, any breach in customer confidentiality is clearly unacceptable," said Mark Hodges, chief executive of Norwich Union Life.
"Our customers can, however, be assured that we have taken this matter extremely seriously and have thoroughly reviewed our systems and controls as a result."
Aviva shares were down 2.9 percent at 654 pence (9.15 euros; $13.20) on the London Stock Exchange.