CPP has launched its new identity protection product after admitting that suspending sales of its previous product had hit revenues and margins.

The York-based business, which employs about 1,000 people at Holgate Park, said in an interim management statement for the period from January 1 that group revenue had grown by 12 per cent up to April 30, with revenue growth in most geographical areas of the business.

But it warned revenues had been hit since it suspended sales of its identity protection production through “voice channels” such as over-the-phone sales in March after it announced it was being investigated by the Financial Services Authority (FSA). It said underlying profit margins had decreased by 0.3 per cent on 2010 to 14 per cent.

“We anticipate that revenue growth for the first half of 2011 will not continue at the level seen in the first four months of the year, being negatively impacted by the suspension of sales of identity protection through our UK voice channels since March 28. Group margins will be impacted by the lost sales, particularly in the first half of 2011,” it said.

The previous identity protection product included an insurance element, which means it must be regulated by the FSA. The FSA said there was confusion over what was covered by the insurance and that CPP had exaggerated the risk of identity theft. CPP denies both these claims.

The company has launched the new product, called Identity Safe, which does not include the insurance element to reduce the legislative burden.

Eric Woolley, chief executive of CPP, said: “We are working hard to make further progress in our new developing markets, which offer significant longer term potential, and we have seen a number of pleasing developments including the addition of a new business partner, SBI Cards, in India.

“Whilst the continuing uncertainty resulting from our ongoing discussions with the FSA is unwelcome, I remain confident that we have excellent products which fulfil a significant and growing need in our society, and a sound business model around which we will continue to grow both in the UK and internationally.”