The Chartered Insurance coverage Institute has denied that its transfer this week to take over the PFS board was about taking management of the PFS’s close to £20m in reserves.
Chris Shadforth, communications director on the CII, mentioned the takeover of the PFS board was not about cash.
He added that the PFS had made “tremendous regular” earnings over numerous years and constructed up wholesome reserves as a result of almost all its companies have been offered by the CII at a comparatively low price.
He mentioned: “The choice of the CII group board to nominate further administrators to PFS Ltd is not going to end in money being moved from PFS Ltd to another firm inside the Institute’s Group of firms in any method completely different from now. Cash already flows between the businesses to be able to pay for the companies PFS members obtain from the group.”
“The PFS revenue and loss account contains PFS membership charges and a recharge from the CII for central companies offered. The PFS doesn’t pay for the total price of offering these companies. Nor has the PFS paid for any of the prices associated to the pandemic, any of the current (and important) IT funding prices, the price of working exams or the price of offering Chartered standing and Statements of Skilled Standing to PFS members.
“In consequence, the PFS Ltd firm has successfully made super-normal earnings yearly and the CII Ltd entity has been carrying losses to fund this outcome. This must be redressed going ahead.”
The CII appointed three new board members to the PFS board this week in an try and take management of its subsidiary, citing considerations over governance.
The PFS responded that that the President and CEO of the PFS weren’t notified concerning the appointments till the morning of the announcement and shared its dismay at how members have been knowledgeable through a membership e mail not seen by the PFS President and CEO earlier than it was despatched.
The PFS is a subsidiary of the CII, and its articles of affiliation give the CII the precise to nominate administrators to the PFS board. The 2 organisations have been at loggerheads for a while over the construction and course of the PFS. Final 12 months the CII axed the position of PFS CEO (held by Keith Richards) however this 12 months did a U-turn and reinstated the position.
The PFS board is at present made up of 5 PFS member director and two institute administrators, with the CII appointing three additional institute administrators which it mentioned will, “equalise the PFS board with quick impact.” The CII then plans to nominate one other director giving it a majority on the PFS board.
The CII mentioned it intervened on the PFS resulting from concern over governance points. CII CEO Alan Vallance mentioned that the PFS had arrange new committees with out CII approval and in addition held conferences with out informing CII administrators who have been entitled to attend.
• A gaggle of PFS members has launched a marketing campaign referred to as ‘Our PFS’ to struggle the CII’s full takeover of the PFS board: https://ourpfs.co.uk/