Watchdog acts on warranty sales
Three businesses that were illegally selling satellite television warranties to customers have been put into provisional liquidation.
Digital Satellite Warranty Cover (DSWC) made a profit of £10m in the last year and had nearly 200,000 customers.
But it had never been authorised by the Financial Services Authority (FSA) to sell warranties.
Satellite Services and Nationwide Digital Satellite Warranty Services, based in Liverpool, were also halted.
The FSA applied to the High Court for the three firms, based in Kirkby in Liverpool, to be put into provisional liquidation to prevent more of the warranties being sold.
In return for an insurance premium of between £6.49 and £11.49 a month, the firms promised Sky customers unlimited call-outs covering all parts and labour costs.
The extended warranty constituted insurance, and companies must be authorised by the FSA to sell it.
Sky has recently written to all customers who had a warranty with DSWC, Nationwide Digital or Satellite to confirm that it will provide free support to any affected customer who has equipment that needs a repair or for a service visit.
"Although the unauthorised warranty companies were entirely separate from Sky and operated independently, Sky made clear that it did not want affected customers to be inconvenienced or left out of pocket," the FSA said.