Land of Leather and its chief executive, Paul Briant, today received heavy fines from the Financial Services Authority (FSA) after inadequately trained sales staff were allowed to sell payment protection insurance (PPI) on loans.

The FSA fined Land of Leather £210,000 for breaching regulations, while Mr Briant’s conduct was deemed “serious” enough to deserve a personal fine for £14,000 for failing to properly oversee the sale of PPI by the company.

According to the City watchdog, after Land of Leather was authorised to sell PPI in May 2006, the furniture retailer failed to ensure all of its sales force were fully trained to sell payment protection until November that year and it continued to sell PPI in its 90 stores without any effective check on its sales force until February 2007.

It was found that the company realised too late that very few of its sales staff informed a customer how much the payment protection would cost after the initial 12-month payment-free period, and that many sales staff did not point out customer cancellation rights.

As a result of its failings, Land of Leather exposed around 58,000 customers to “an unacceptable increased risk of buying unsuitable PPI”.

In practice, while most customers did not incur a fee, as many would pay for their purchase before a 12-month payment free period runs out, 8,200 would have incurred the cost of a single premium of up to £719 for the PPI cover for the loan.

The total amount of premiums paid by Land of Leather customers was projected to be around £3.1 million.

The FSA said that the Land of Leather fine is part of an ongoing investigation into the use of PPI loans by leading retailers.

A spokeswoman at the FSA, said: "We’re looking at loans and PPI as a whole. As part of its work, the FSA is looking at retailers with loans on retail goods. PPI is a major area, and its an area with very large consumer detriment. We’ll be doing a lot on it in the future as well.”

The FSA has previously fined six companies over poor PPI selling practices, with HFC Bank receiving the largest fine of £1.085 million.

A spokesperson for Land of leather said, “We were not mis-selling these products, but we do regret that some of the service processes around their sale were not as robust as our customers have the right to expect.

“We acted quickly to remedy these weaknesses and have been authorised to sell these products over the last five months. All costs associated with this issue were fully provided for in our last accounts. We are now once again offering this service with appropriate procedures in place to ensure that our customers receive the highest levels of service in this area."