Too slow: L&G faces new fine

INSURANCE giant Legal & General could face a heavy fine from the Financial Services Authority because it has been too slow paying compensation to victims of mortgage endowment mis-selling.

The penalty would be on top of the £1.1m fine that the FSA already wants to levy on the insurer for the alleged mis-selling of endowments in the late Nineties.

L&G boss David Prosser is vigorously opposing the fine.

A Financial Mail inquiry shows many customers have been waiting more than three months for compensation despite assurances from L&G that payment would be made in 28 days.

The regulator has the power to fine companies who fail to pay compensation promptly once redress has been agreed.

L&G was one of four insurance companies warned by the FSA earlier this year that it had until April to sort out its backlog of endowment complaints or face disciplinary action.