Dixons Carphone has been fined £29.1m for historic mis-selling of mobile phone insurance.
The Financial Conduct Authority (FCA) issued the penalty for behaviour between December 2008 and June 2015 at Dixons’ subsidiary, Geek Squad.
Geek Squad staff were trained to recommend insurance to customers who were already covered through their home insurance or bank accounts, the watchdog said.
Instead they were trained in so-called spin selling, where customers were pushed to buy the insurance, and on “objection handling” to overcome customer scepticism, rather than assessing whether the product was actually right for those customers.
Complaints from customers were not adequately followed up by Carphone Warehouse, meaning valid complaints were not upheld.
The FCA said it only discovered the bad practice after whistleblowers got in touch.
Mark Steward, executive director of enforcement and market oversight at the FCA, said: “The Carphone 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.
“Without 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.”
In a statement, Dixons said it “accepts that in the past the company's practices fell short”.
However, it said the FCA acknowledges that Carphone Warehouse has made “significant improvements” since 2015, and has carried out two customer redress programmes.
The retailer told investors today that the penalty will not hurt guidance it issued in January, in which it retained full-year profit targets.