Could Churchill & Direct Line’s £2.17m FSA fine have been avoided with better systems? Oh yes…

 ‘FSA imposes £2.17 million fine for failure by Direct Line and Churchill to conduct their businesses with due skill, care and diligence’
http://www.fsa.gov.uk/pages/Library/Communication/PR/2012/003.shtml

The Financial Services Authority (FSA) has imposed a fine of £2.17 million for failings by Direct Line Insurance Plc and Churchill Insurance Company to prevent files that the FSA had requested from being improperly altered.

In collecting the 50 complaint files for review, the FSA found 27 of the files were altered before submission, due to the firms failing to act with due skill, care and diligence. 

The failing for which these insurance firms are being penalised is clearly inappropriately enabling staff to alter files. This kind of alteration can largely only occur when files are stored without sufficient versioning control. In itself, this is a huge downfall, more so when an audit trail is required. For legally admissibility purposes document and content management applications make this impossible. 

Manually archived documents are not afforded the same security as those which are electronically available. For a long time, we have been professing that a document management system provides an indisputable record for files and as such a key element, and typical requirement, of this system is immutability – once an item is entered into the system it cannot be altered under any circumstance, and it seems that those within Direct Line and Churchill would have done well to have implemented such a system. 

Working with previous clients in the Financial Services arena has given us a full appreciation of the variety of needs that such organisations have. The main requirement is usually the ability to provide a clear audit trail of every single document – essential in order to comply with FSA requirements. Through using a document management system, the software enables all of the business content to be rigorously controlled and yet also easily shared, with the ability to administer security controls of various strength determined by the document itself. 

The main point associated with it is that once in the system, documents simply cannot be altered. This in itself that would have saved these two insurers a lot of trouble, and cash.

A tale of two cities?

In our news section, we’re talking about a tale of two cities. Not exactly original, but it comes to mind with two new case studies – Seren Group in Newport and, a quick hop down the M4 in Cardiff, Hendre. They are both engaged in social housing and both have been delighted with their Invu experience. Housing Associations (HA’s) are waking up to Invu with its wider portfolio of products and integration opportunities with housing systems. Forty plus HAs have adopted Invu and, increasingly, the demand is for document management at the heart of the business.

HAs face a bombardment of documentation, from invoices, to maintenance orders, to tenant correspondence and much more. Service levels can massively improve if the documentation is immediately to hand and a 360˚ view of a tenant’s affairs or suppliers transactions are to hand. HAs come under tight regulation and service levels are an important benchmark, so being able to respond quickly with all queries answered first time is a significant measure of success. It’s also a measure of efficiency and cost saving. Right now there are still many HAs find themselves reliant on paper filing and queries may take hours or days to get answered and then only in part – add in the “whilst I’ve got you”, almost mandatory supplementary question and you could be back to square one. You can see why a good eDM solution is needed.
HAs face particular issues with accounts payable – often working with a host of suppliers. Many of these are likely to be local and small in keeping with an ethos of trading in the community where possible. Quick payment is often critical to these suppliers. However, manual processing of paper invoices can be a slow process. Invu’s invoice processing solutions cut through this – we’re getting increasing and encouraging demand here. Invoices are scanned, the relevant data is extracted from the invoice and then looked up against the finance system for supplier details, POs etc. This then initiates an automatic workflow for authorisation – what might currently be 1-2 week’s worth of round trip can be simplified to minutes, all without the fear of loss and all whilst still having sight of the information for queries. Extending Invu Document Management out beyond a passive repository can make a huge difference to the way businesses work and this is a great example of a sector where the fit is especially good. Invu’s engagement with HAs continues to get closer and stronger – we hope to see our South Walian friends at Seren and Hendre joined by many more HA peers using Invu.many more HA peers using Invu.