The Financial Conduct Authority (FCA) has fined Carphone Warehouse \u00a329,107,600 for failings that led to the mis-selling of \u2019Geek Squad\u2019, a mobile phone insurance and technical support product. \r\n\r\nThe watchdog found The Carphone Warehouse failed to give its sales consultants \u201cthe right training to give suitable advice\u201d to customers purchasing Geek Squad.\r\n\r\nIt added that in particular, sales consultants were not trained adequately to assess a customer\u2019s needs to determine whether Geek Squad was suitable. They were trained to recommend Geek Squad to customers who already had cover, for example through their home insurance or bank accounts. \r\n\r\nIt determined that sales staff were trained in 'spin selling' and \u2019objection handling\u2019, with the focus being on \u201covercoming customer objections rather than assessing whether the product was suitable for the customer\u201d.\r\n\r\nWhen customers complained about the sale of Geek Squad, Carphone Warehouse \u201cfailed to properly investigate and fairly consider their complaints\u201d resulting in \u201cvalid complaints not being upheld in circumstances where the product had been mis-sold\u201d. \r\n\r\nDuring the period under investigation from 1 December 2008 to 30 June 2015, Carphone Warehouse made regulated sales of Geek Squad policies worth over \u00a3444.7m, of which a high proportion of these policies were subsequently cancelled early. \r\n\r\nThe FCA said in January 2014 alone, 35% of policies were cancelled within the first three months from inception and added this was an \u201cindicator of a risk of mis-selling which Carphone Warehouse failed to properly consider\u201d. \r\n\r\nThe FCA therefore found that The Carphone Warehouse breached Principle 3, Principle 6 and Principle 9 of the FCA\u2019s Principles for Businesses between 1 December 2008 and 30 June 2015.\r\n\r\nThe firm did not dispute the FCA\u2019s findings and exercised its right, under the FCA\u2019s partly contested case process, to ask the FCA\u2019s Regulatory Decisions Committee to assess the appropriate level of sanction. The firm\u2019s agreement to accept the FCA\u2019s findings meant it qualified for a 30% discount. Otherwise, the FCA would have imposed a financial penalty of \u00a341,582,300.\r\n\r\nMark Steward, executive director of enforcement and market oversight at the FCA, said: \u201cCarphone Warehouse and its staff persuaded customers to purchase the Geek Squad product which in some cases had little to no value because the customer already had insurance cover. The high-level of cancellations should have been a clear indicator to the management of mis-selling.\r\n\r\n\u201cWithout whistleblowers coming forward these practices may never have come to light. In the past few years, whistleblowers have contributed critical intelligence to the enforcement actions we have taken against firms and individuals.\u201d\r\n\r\nAlex Baldock, group chief executive at Dixons Carphone, said: \u201cWe\u2019re obviously disappointed that Carphone Warehouse fell short in the past. But we\u2019re a very different business today; as the FCA acknowledges, we\u2019ve made significant improvements since 2015. We\u2019re committed to stay on that trajectory, and to make sure all customers enjoy the right technology products and services for them.\u201d\r\n\r\nCarphone Warehouse revealed the company has since introduced more comprehensive customer-needs assessments, enhanced colleague training and compliance monitoring, invested in customer service and post-sale customer satisfaction, and substantially increased the number of independent financial services coaches across the Carphone Warehouse store estate.\r\n\r\nThe company has also voluntarily carried out two customer redress programmes, covering complaints and cancellations.