Brokers have been warned to ensure that proper internal controls are in place to tackle a rise in simple but potentially business-threatening fraud.
Law firm Pinsent Masons, issued the warning following the banning and fining of a mortgage adviser for fraud.
Bruno Geiringer, insurance partner at the law firm, said: "This is a timely warning to all adviser firms to ensure proper controls are in place to pick up and check the submission of applications for own adviser product sales by their representatives.
"This is not a new or complicated way of gaining money and sometimes the fraud is just plain and simple, as in this case. The problem is that it can easily and quickly destroy the adviser firm's reputation and regulatory standing.
"Unfortunately, due to the financial crisis and tough economic times, we are seeing more and more fraudulent activity."
