The Financial Conduct Authority (FCA), the UK financial regulator, fines Carphone Warehouse to the tune of £29 million following an investigation into the "Geek Squad" mobile phone insurance and technical support offering.
According to the FCA, the retailer sales consultants were not adequately trained to give suitable advice to customers buying Geek Squad. Instead, salespeople were trained in "spin selling," or simply recommending Geek Squad to customers even if they had already had cover, such as through home insurance or bank accounts. The sales lead to a high early cancellation rates, something the FCA says is an indicator of a risk of mis-selling Carphone Warehouse failed to consider.