PPI Return Blog

Lloyds Boss - Worse than Expected, Banks' chiefs face a grilling

2011-06-07T04:36:00.000-07:00

Its been a few weeks since the banks decided not to appeal the Judicial Review ruling in the High Court. As a result, we did expect to see cases being investigated and settled.

Unfortunately, this has not yet happened (aside from a selection of cases with MBNA). I am really disappointed with some of the other banks for failing to have any provision in place to begin dealing with the claims. It seems to be that the banks were woefully under prepared following the Judicial Review - this is only serving to delay the settlement of cases further. We are determined to push the banks as much as possible so all our clients' outstanding cases can be settled and we hope to see real movement with the banks' processing sooner rather than later.

On another issue, the new chief executive of Lloyds Banking Group, António Horta-Osório, has admitted the problems he inherited were much more severe than he ever anticipated. He went on to say that it could take up to five years for the bank to recover. He specifically focused on particular problems but said some, such as the mis-selling of payment protection insurance and bad Irish loans 'ran deeper' than he expected.

This comes as little shock given the huge amount of cases we have been dealing with against Lloyds over the last few years. We have always had more Lloyds PPI mis-selling cases than any other bank and the £3.2 billion set aside to compensate customers is a sobering reminder.

Finally, the bosses of the big banks are due to face some tough questioning from MPs on their failure to hit lending targets agreed earlier this year. The pressure is also growing for a new tax on bankers' bonuses. The bankers are also expected to be asked why they decided to give up on the issue of payment protection insurance and drop their legal challenge (which no doubt cost the banks millions to bring).

If you think you have been mis-sold PPI, please get in touch with us at www.ppireturn.co.uk. Now has never been a better time to make a claim!

Banks clawing back bonuses, Loophole Exploited and Yorkshire / Clydesdale count their pennies

2011-05-23T01:40:00.000-07:00

The big banks are considering whether to clawback bonuses paid to executives who oversaw retail operations when Payment Protection Insurance sales were at their height. As compensation to customers is expected to run into billions, banking bosses were able to take millions in bonuses during the years in which the mis-selling took place.

The head of Lloyds, Antonio Horta-Osorio said last week the bank’s remuneration committee would review to see if those clawbacks were appropriate. Furthermore, Brian Hartzer, head of RBS, said on Friday they would consider the clawbacks, as did HSBC and Barclays. The old Lloyds chief executive Eric Daniels and former retail boss Helen Weir may be targets for the clawbacks.

In the scheme of the mis-selling, the clawbacks will be tiny in comparison to the amount which is due to be paid back to customers. Clearly there is a desire to see the senior management held accountable for the mis-selling which occurred whilst they were at the banks. In practice, the banks may struggle to obtain those clawbacks legally, but im sure matters will become clearer over the next few weeks.

Further reports this week focused on the banks potentially exploiting a 'loophole' to get out of paying certain types of claim.

The reports suggest that banks are hiding behind rules which say they don’t have to investigate any complaint they have already rejected. A complainant should have 6 months to refer their complaint to the Financial Ombudsman Service should it have been rejected by the lender. Although the new FSA rules state banks should consider contacting customers who haven't complained, there are no such provisions for customers who have had a complaint rejected.

There are substantial numbers of complainants who have failed to appeal a rejection in good time and its a shame those customers did not seek guidance before during their claim. It is a fact that only 4-5% of complainants in person decide to appeal a rejection from their bank which has left thousands potentially out of pocket. I would always suggest that customers take adequate advice before making a complaint. The rules and processes can be daunting to those who are not used to the banks complaints procedures.

Finally, Yorkshire and Clydesdale Banks are making a £100m provision to cover compensation for the mis-selling of payment protection insurance (PPI). The banks are paying out considerably less than most of the other big UK banks.

Yorkshire and Clydesdale said their decision to make the £100m provision follows the announcement by the British Bankers’ Association that it does not intend to pursue the judicial review process. Chief executive Lynne Peacock said “As a bank we were not involved in the judicial review, but as the outcome of the BBA case is now clear it is prudent for us to provide against future PPI claims as other banks have done.
“Our assessment of £100m is based upon estimates and assumptions that continue to be uncertain, but we feel this is an appropriate amount to account for claims yet to be received and the probability of success of those claims.

The news is clearly to be welcomed by consumers who felt they were mis-sold PPI by the bank, the £100m provision will almost wipe out their £101m half year pre-tax profit.

If you think you have been mis-sold PPI, please get in touch with us at www.ppireturn.co.uk. Now has never been a better time to make a claim.

Current Account Fees, Concern at HSBC and FTSE Struggles

2011-05-16T04:25:00.000-07:00

Unfortunately, despite the JR being decided clearly in the customer's favour, we are yet to see clear strategy from any of the banks on how they intend to deal with the backlog of complaints. Many of the big banks appear to still be locked in meetings about how they intend to deal with the cases. Furthermore, they appear to have yet to analyse their strategies fully about how they intend to deal with future claims.

We hope to begin seeing our clients claims settling very soon so we can get them the money they rightly deserve!

In the meantime, there are many more stories surfacing about account fees and charges. It is becoming much clearer now that because the banks have set aside so much money to potentially repay PPI to customers that they need to recoup that lost money elsewhere. It surely wont be too long before we are all paying monthly account fees to our banks as non-fee paying accounts reduce month by month.

A story surfaced about HSBC's liability to repay PPI to their customers. Although they had set aside some £250 million, they admit that the overall cost may be different as they take into account many 'other factors'. These factors include the nature and volume of customer complaints, the extent to which HSBC may be required to take action, and the facts and circumstances of each individual customer's case.
Accordingly, bosses admitted there was currently a "high degree of uncertainty" around the ultimate costs of dealing with the matters.

Finally, the FTSE took a small tumble as a result of the banks' confirmation of their PPI liabilities. This was to be expected as the nations biggest institutions forecast poor results for the coming years as a result of PPI compensation.

If you think you have been mis-sold PPI, please get in touch with us at www.ppireturn.co.uk

Judicial Review Over, FSCS Targets Insurers and Banks Recoup Losses

2011-05-10T03:17:00.000-07:00

Millions of people are now due to receive up to £9 billion in compensation as the banks decided to surrender their option to appeal Judge Ouseley's High Court decision against them. This means that all the banks must now adopt the provisions in the FSA's Policy Statement and begin reviewing cases and paying out compensation to customers.

The BBA released a statement yesterday confirming they didnt intend to appeal the Judicial Review. As a consequence, there has been some significant coverage in the press concerning the banks liability for PPI complaints. Lloyds TSB, by far, has the largest liability, suggesting it will need to pay around £3.2 billion in compensation to aggrieved customers with RBS at £850 million, HSBC at £270 million and Barclays at £1 billion.

Just how the banks intend to clear the huge backlog of claims is yet to be announced, but we are beginning to see some cases with FOS being upheld in the customer's favour already. The advice is to ensure you make your claim without delay!

In other news, the FSCS has suggested it intends to pursue insurers involved in the mis-selling of payment protection insurance. Historically, cases have always been dealt with against the party who provided the advice to take out the insurance policy. But the FSCS would like to begin scoping out the possibility of approaching insurers directly as they attempt to establish a common law duty that the seller of the policy was an agent of the insurer.

This will assist smaller IFAs and intermediaries by putting a percentage of the FSCS levy onto the shoulders of the big insurance companies. The idea has similar connotations to the Keydata saga between the FSCS and Norwich and Peterborough Building Society.

We have always agreed that some of the burden (especially loans sold by non-GISC members pre-05) be analysed for potential liability against the insurer and hope this will go some way to allow this to happen.

Following on from a recent article, there has been renewed analysis concerning how the banks intend to recoup losses from PPI compensation. It therefore has come as no shock to see credit card companies are charging the highest rates for 13 years. These stealth increases across the banking sector are fuelling the huge deficit made by the ban of PPI and subsequent funds to compensate customers. However, at least the fees and charges are becoming clearer. For example, customers may feel happier paying a monthly account charge for clear benefits rather than funding an unnecessary insurance policy. Im sure the banks will continue to find new ways to make money as time passes.

If you think you have been mis-sold PPI, please get in touch with us at www.ppireturn.co.uk

Lloyds - Judicial Review U Turn

2011-05-05T03:52:00.000-07:00

Reports are surfacing suggesting Lloyds do not intend to participate in the Judicial Review action with the British Banking Association.

This is a massive U-turn from their position in October 2010 when they made positive declarations that they would not be processing complaints until the Judicial Review was decided.

Although, Judge Ouseley had found in favour of the FSA / FOS on the 20th April, the BBA and its members were still considering whether to appeal the decision. They have until the 10th May to do so, but this new stance from Lloyds may be a decisive indicator of what the banking industry intend to do.

Mr Horta-Osório (the new chief exec at Lloyds) has made it clear that they no longer intended to participate in the industry-wide action. "We will not be participating in the BBA review,". He went on to say that "It is the sensible, prudent and right thing to do, we believe it draws a line under this issue,". He added it provided "certainty" for customers and was "in the long-term stability" for the business. The statement goes a long way to try to position Lloyds well away from its previous mandate and will only benefit consumers.

It will be interesting to see whether this statement affects the rest of the industry, but this goes some way to allowing the victims of PPI mis-selling to finally recoup their losses.

If you think you have been mis-sold PPI, please get in touch with us at www.ppireturn.co.uk

Banks Ponder Appeal, FSA Statement and No More Free Accounts

2011-05-03T04:11:00.000-07:00

Following the release of the judgment in the Judicial Review action against the FSA, banks are clearly holding meetings with their lawyers to decide whether to carry on their court fight.

The British Bankers' Association (BBA) only has until 10th May to ask for permission to appeal after the High Court rejected its claim that new rules for handling complaints about the mis-selling of PPI were unlawful.

They are under huge pressure from the Financial Ombudsman Service FOS not to delay the progression of the cases any longer. The Chief Ombudsman, Natalie Ceeney, says 'fighting on will damage the banks' reputations further'. Miss Ceeney went on to say 'Now we have a clear-cut ruling, we need to work together to resolve these complaints as quickly as possible. It will greatly benefit all of our reputations to do so.'

The FSA also released a statement stating the decision "signals the end of years of poor payment protection insurance complaint handling" and would "trigger a dramatic improvement in the way customers are treated when complaining". The FSA went on to say that their "primary aim has always been to get proper redress, once and for all for those with genuine complaints."

They reiterated they had not put a waiver in place to allow banks not to progress PPI complaints and warned banks they would suffer enforcement action if they failed to investigate complaints fully.

The outcome as it stands is that the Judge found that the Ombudsman has an extremely broad discretion when assessing consumer complaints; firms must take account of the FSA's Principles for Business in addition to the specific conduct rules in their complaint handling processes and firms will need to pay very close attention to the Principles when assessing a sale of regulated products even where there are specific rules which apply. As such, it is clear that although the Judge took particular note of the provision that the Principles could not give rise to a cause of action in a Court, the Principles still had an overarching role in the regulation of banks and so should be used as a factor in the determination of complaints.

Whatever happens on or before the 10th May, at least the matter will be progressed and we will be able to see some movement.

Some more reports have been surfacing signalling the end of free banking and current accounts charging customers a fee now outnumber those that do not. There are now 58 free accounts open to customers, down from 65 in 2009.

Meanwhile, providers have increased the range of packaged accounts that levy a monthly fee in return for additional benefits such as free travel insurance. Furthermore, the prices charged for those accounts are also rising. In 2006, the average packaged account cost just over £10 per month. Now customers pay more than £15 on average – and a range of providers, including Barclays, NatWest and RBS, charge even more.

In 2008, the Office of Fair Trading estimated that banks made on average £152 per current account as a result of interest, fees and charges. This more than covers the cost of so called 'free banking' for its customers. But lost revenues from other areas need to be recouped and so we may start finding ourselves stuck with one or two banks who offer these free accounts, limiting our choice across the marketplace.

Banks Lose, What Next ?, Doomsday - no more free banking !

2011-04-26T08:09:00.000-07:00

The fog still needs to clear, but it has become apparent that the Judge has made some precise and specific assessments of the arguments formulated by the BBA, FSA and FOS. He has arrived at a measured, reasonable conclusion taking into account all the material information presented to him and has arrived at a decision which benefits the consumer. Whilst the judge was clearly persuaded by some of the BBA's arguments, he ultimately felt that the FSA Principles could be used in the determination of PPI complaints. He went further to say that even if the Principles couldn't be used, the Ombudsman could still assess claims on what was a 'fair and reasonable' outcome to all parties involved - essentially, FOS could arrive at any decision it wanted.

Regardless, this all means very little if the banks decide to appeal the High Court decision. They have until 10th May to do so and the chances are very likely. The banks will be able to delay the final decision further and will be at least 8-10 months before the appeal is heard. However, on the other hand, there is an immense amount of pressure on the banks to begin paying compensation again and that media pressure may well be too much for the banks' PR departments to handle. Whatever happens, will happen very soon, and at least we can be sure that this huge bottleneck will be moved forward in some respect.

However, as the decision was released, free banking was set to be under threat that the outcome of the Judicial Review will could cost the banks £4.5billion. Some believe that the losses will be recouped from customers through more expensive banking and even the end of free current accounts.

It is already becoming common for customers in the UK to not have free current accounts and banks presently charge between £3 and £25 a month for account services (like travel insurance and car breakdown cover), guaranteeing them millions of pounds a year.

Banks Lose Judicial Review !!!

2011-04-20T02:56:00.000-07:00

Great news surfacing throughout the press.

The BBA appears to have lost its legal challenge against the FSA in respect of Payment Protection Insurance complaints.

Likely to be appealed - but a fantastic result for the victims of mis-selling throughout the UK.

Big Decision Soon, Lots of Levies, FSCS Changes and New Rules for PPI

2011-04-19T01:36:00.000-07:00

Big news this week is the likelihood that the Judicial Review decision will be handed down on Wednesday (tomorrow). I expect the decision will provide an element of clarity on the state of PPI complaints, but its still likely to be appealed to a higher court.

The Financial Services Compensation Scheme has this week set the 2011/12 levy on general insurance intermediaries at £69.5m. This is the amount the industry will be expected to pay to help the FSCS meet its commitments. Last year the levy for insurance brokers rose to £61.4m - mainly due to cover the costs of payment protection insurance (PPI) claims.

Despite some reports alluding to panic that brokers wouldn't be able to cope with the increased levy, it is clear that the final levy is some £23m less than originally projected and so more palatable throughout the industry. Furthermore, with the FSCS intervening earlier in firms who are likely to go into default, there is a greater chance (as in Welcome's case of some money being set aside for future claims).

Similarly, the FOS has also had to increase its levy on the industry which has been met with some criticism from the The Association of British Insurers.
In January, the FOS confirmed it was seeking a levy increase of up to £30m.
But last week, the FSA approved a £25m increase for 2011/12 to fund reserves so the ombudsman can deal with an expected surge in payment protection insurance complaints.

The ombudsman said before the levy was introduced that the loss of income from case fees as a result of the judicial review would exhaust its reserves within six weeks. Hopefully, the extra cash will enable FOS to deal with each complaint in a more timely manner.

Alan Meale, Labour MP for Mansfield and Mark Durkan MP for Foyle have called on the government to immediately begin its promised review of the FSCS. They have highlighted the increased levy as a catalyst to scope out the potential for significant changes in the way in which the FSCS is managed.

The new rules set out by the Competition Commission to introduce competition into the payment protection insurance (PPI) market have came into effect.

It has been ruled that PPI be banned at the point of sale until seven days after the sale and has further ruled that there must be a seven day gap between a PPI quote being issued and the sale. These quotes must set out the cost of the policy along with details of the cover provided and supply information in marketing material about the cost and key messages, for example making it clear that PPI is optional and available from other providers.

It has further been ruled that providers are obligated to provide information about claims ratios and are totally prohibited from selling single-premium PPI policies. Insurers must also provide an annual review setting out the cost of PPI and including a reminder of the consumer's right to cancel.

Un-Welcome, the Importance of IP, FOS Levy, Bad Barclays and Lloyds getting better!

2011-04-04T06:34:00.000-07:00

The blog had a week off - but back now with more stories! Its been a busy couple of weeks in PPI. I initially commented on Welcome's current predicament a few weeks ago. Welcome have been declared in default which would have meant that any claim against them for PPI compensation should now be made to the Financial Services Compensation Scheme (FSCS). The FSCS would normally look to pay out individual compensation claims on behalf of a business, once that business has been declared in default (ie, not able to pay claims made against it). The problem is that the FSCS intend to use any compensation to reduce the balance of the customer's loan account. This isnt unreasonable, as the customer benefits from being able to repay the loan earlier - but given most loans are refinanced regularly, the client will miss out on a cash settlement. This is likely to put customers off from claiming - especially when they are sent a long complicated FSCS application form directly to complete. Alan Lakey of Highclere Financial Services made comment about the important of Income Protection Plans and how more IFAs (and in my opinion, banks) should look to prioritise protecting the consumer before selling them packaged accounts, investments or other finance. There are some fantastic protection plans in the marketplace which can cover you for accident, sickness or unemployment for a specific amount every month until you return to work. It is important these policies arent tainted with the same brush as single premium PPI sold on loans and other finance. They have real benefits in difficult times and should be taken more seriously in these uncertain economic times. Unsurprisingly, the Ombudsman's levy has increased. Essentially, the FOS needs money to process claims and the sheer volume which it is presently dealing with means it needs a lot more to function properly. 30% of the levy is coming from banks, building societies and mortgage lenders, 37 per cent would be paid by general insurance intermediaries, and 12 per cent by general insurers. This seems to be a fairer spread across the industry to account for the increased levy and should allow the FOS to push ahead with its cases. Barclays has been flagged as Britain's most complained about bank with 276,315 complaints raised against it in the second half of 2010, according to the Financial Services Authority. The second worst offender was Santander with 195,475 complaints, taking the total number of grievances involving high street banks to more than a million or 5,750 per day. This is a welcomed change as Lloyds used to head the league table of complaint data with its appalling record! On the other hand, Lloyds, with their new chief executive, wants to cut complaints about the bank by 25%. This can only benefit the consumer and I welcome his enthusiasm - hopefully his target will be dramatically exceeded - Lloyds have certainly got a lot of work to do! If you want to make a claim about your PPI, visit www.ppireturn.co.uk to begin your case.

FSCS Levy and Expensive Life Cover

2011-03-21T03:13:00.000-07:00

Last week was fairly quiet for PPI stories. Still haven't heard much regarding the Judicial Review and thankfully, we are continuing to see a lot of claims being paid out. The advice is still to make a claim regardless of the Judicial Review as soon as possible.

It was suggested that as a result of Payment Protection Insurance misselling, the levy which the Financial Services Compensation Scheme has apportioned onto the industry has caused a 70-fold cost increase for the insurance intermediary sub-class.

The BIBA head of compliance and training Steve White said: “The misselling of PPI by credit brokers has caused a 70-fold increase in FSCS levies over the last three years. A firm that paid £3,000 three years ago is now being faced by a levy demand this summer of £210,000."

These increases are particularly large for the smaller intermediary. A system which fails to apportion the levy on risk (insurance mediation) is grossly unfair to those advisors who never sold PPI. The sooner the system can be made fairer, the sooner certain aspects of the industry can burden the cost of what was a very turbulent area of selling.

Banks have been accused of selling homebuyers life insurance at the sale of the mortgage which was unnecessary and expensive. Life insurance sold with a £200,000 mortgage can cost up to £300 a year more with some high street banks compared with separate insurance from a comparison website.

It is normally the case that basic level life insurance is sold with a mortgage. The borrower pays the same sum every month and the insurer agrees to repay the mortgage if the borrowers dies. The insurance has echoes of PPI misselling in that it could be sold to single people who had no requirement for it, or added an expensive extra cost to the mortgage loan. We would always prompt individuals to shop around for the best deal they can find on the market rather than settling on the first quote from their mortgage lender.

If you think you have been mis-sold Payment Protection Insurance Policy, do not hesitate to contact us via www.ppireturn.co.uk

Big bill for PPI and New Head of Lloyds

2011-03-18T06:57:00.000-07:00

Last week, Jonathan Evans MP suggested that the overall liability for payment protection insurance (PPI) mis-selling could reach £4bn.

The amount was highlighted at an evidence meeting of the All Parliamentary Group on Insurance and Financial Services at the House of Commons. Both the British Insurance Brokers' Association and the Association of Independent Financial Advisers gave presentations.

Mr Evans MP, who chaired the meeting, said: "I've seen indications that in due course the overall liability in relation to PPI is likely to be not in the hundreds of millions but the billions [of pounds]. I heard a figure of perhaps even £4bn mentioned as an end game figure." He said "The expectation is that over the next few years a significant figure is going to become a colossal figure."

This figure follows on from similar estimates given by the industry last year. But any presumption becomes speculative when the outcome of the Judicial Review could affect a large majority of the claims anyway. Regardless, it is still troubling to see so many victims out there that have not yet made any attempt to make a complaint. We would urge people to come forward and claim what is rightfully theirs at www.ppireturn.co.uk

In other news last week, the head of Lloyds high street banking is leaving to be replaced by Antonio Horta-Osorio. The currently appointed Helen Weir will leave as Mr Horta-Osorio attempts to rebuild lloyd's poor customer service image.

With the Ombudsman suggesting that one in four new cases it received was about Lloyds, a new head with customer service as his top priority may change their present record. It may also be the case that the tranche of delayed Lloyds PPI matters may begin to start moving again.

Dont forget, if you think you have been mis-sold PPI, make sure you contact us asap at www.ppireturn.co.uk

Welcome Bust and Lloyds making billions

2011-03-09T03:35:00.000-08:00

The Financial Services Compensation Scheme (FSCS) declared Welcome Finance in default on the 2nd March.

This means that the FSCS felt it was satisfied Welcome was unable, or likely to be unable, to pay claims against it in relation to payment protection insurance (PPI).

Welcome sold a huge amount of PPI policies to its customers, and its 'default' opens the way for those customers to bring a claim directly to the FSCS for compensation.

In an unprecedented decision, Welcome will assist the FSCS by providing cash and resources to deal with any future or ongoing cases. The move is a positive and considered step by the FSCS to allow it to process claims efficiently by having access to Welcome's records. We are keen to advise any clients who have a loan with Welcome that they should approach us without delay so we can deal with their case. Although Welcome is officially no longer trading, aside from a couple of changes, we can still claim compensation.

There are some other reports this week showing Lloyds losing £70 million per year following their decision to stop offering PPI on their accounts. However, the bank still returned to a healthy £2.2 billion pound profit last year after a £6.6 billion loss in 2009. No doubt they will find another product to replace the profitable insurance !

Finally, the ABI made comment this week on Ombudsman case fees. Each FSA regulated business must pay the Ombudsman £500 per case when it reviews a complaint. This means that companies like Lloyds are providing a huge amount of funds to FOS to cover its operating costs. The ABI is calling for claims management companies to contribute to the Ombudsman's costs as they are somewhat responsible for the influx of PPI claims. I believe much of the reason for the increased costs comes from the manner in which some banks have chosen to deal with cases after the Judicial Review was announced in October 2010. The industry is always keen to work with FOS to alleviate any pressures and to ensure cases are dealt with as efficiently as possible.

If you think you have been mis-sold Payment Protection Insurance Policy, do not hesitate to contact us via http://www.ppireturn.co.uk/

Lloyds Complaints Rise, ABI disagrees with FOS and BIBA unhappy with FSCS Levy

2011-02-28T01:51:00.000-08:00

The biggest processor of PPI complaints in the UK (Lloyds bank) have reported an increase of 14% in complaint numbers over the second half of 2010.

In particular, PPI complaints jumped by a massive 69% to 148,300 as more customers became aware of the potential of PPI misselling. However, complaints about banking fell by 12% to 154,555, equating to 2.1 complaints for every 1,000 accounts from 2.4 in the first six months of 2010.

It is promising to see Lloyds complaints in other areas reducing. Although whilst consumer concerns focus on PPI misselling - there are still other areas which may rise once PPI matters ultimately reduce. In particular, complaints are rising about packaged account charges.

The ABI has hit out at the Ombudsman Service, questionning their suggestion to substantially increase their reserves – and thus the levy on firms. The ABI said "They (FOS) suggest the main reason for them wanting to do so is the impact that the banks’ judicial review of PPI complaints may cause. Yet the FSA has already confirmed that it expects the majority of PPI complaints to be dealt with by firms, so the FOS is unlikely to see a significant reduction in case income.”

Although the ABI do highlight the FSA's argument that most complaints should be dealt with by the relevant firm, the reality is that we find a substantial amount of cases being placed on hold as a direct consequence of the Judicial Review. Furthermore, with 4500 new cases being presented to the Ombudsman on a weekly basis, it is perhaps careless to suggest their reserves will remain consistently high over the next 6-12 months.

Finally, the British Insurance Brokers Association (BIBA) have added to the furore about levy increases at the FSCS. They say the current FSCS funding model is unfair to the industry and have created template letters to send to local MPs in the hope that they in turn will encourage the Financial Services Authority to "proceed urgently with consulting on a revised model".

This reflects other similar calls to the FSCS over the last few weeks from other bodies. The levy on firms who have never sold PPI could be viewed to be unfair, but an alternative could be equally as unfair on another section of FSA regulated firms. Hopefully, the FSCS will arrive at a reasonable consensus with the industry.

If you think you have been mis-sold a Payment Protection Insurance policy, do not hesitate to contact us via www.ppireturn.co.uk.

More FOS Complaints and FSCS Levy Backlash

2011-02-22T04:37:00.000-08:00

More analysis from the Ombudsman (FOS) last week updating us on what we all knew - PPI complaints are continuing to rise at their offices. Around a third of our cases are now with FOS and we have noted they received 25,000 new cases in the last three-month period of last year. The Ombudsman warned the industry that the extra work would affect the levy paid by businesses to the service.

It was commented that the result meant that FOS had been receiving as many as 4500 new PPI complaints a week.

According to the data, the ombudsman received 50,378 new complaints about financial products in the last quarter of 2010. Current accounts were responsible for 10 per cent of all complaints, credit cards accounted for 8 per cent, mortgages 4 per cent and overdrafts and loans 3 per cent of all cases. Of the total number of PPI complaints, 66 per cent were resolved in favour of the consumer. This is certainly much less than the 90% + the FOS were headlining last year.

In other news, brokers continue to lobby for changes within the FSCS as a result of its increased levy on all firms irrespective of whether those firms were involved in the controversial sale of PPI policies. Calls are being made for changes in the way the FSCS imposes their levy increases - which can only be positive for those brokers and IFAs who have not been involved in the sale of the policies.

And, whilst most banks are deciding to leave the PPI industry behind, other companies are seizing the opportunity to offer competitively priced policies (Legal & General and What Insure being two recent candidates).

If you think you have been mis-sold a Payment Protection Insurance policy, do not hesitate to contact us via www.ppireturn.co.uk.

Consumer Champion Feedback and FOS Complaints Rising

2011-02-14T02:43:00.000-08:00

MPs have asked the Government to scrap plans to frame the new Consumer Protection and Markets Authority (CPMA) as a consumer champion. The Treasury select committee suggests using the phrase could mislead consumers into believing the new regulator is something very different.

They said “If a regulator is promoted as a consumer champion, consumers may falsely believe all financial products are risk free, creating moral hazard. It is simply not possible to protect every interest at all times.”

The title of Consumer Champion has always been reserved for Martin Lewis and other consumer facing organisations. To suggest a regulator is a 'Consumer Champion' doesnt particularly fit with its overall responsibilities to its members.

On another story, complaints about payment protection insurance (PPI) now make up half of the workload of the Financial Ombudsman Service (FOS). The service received a huge 24,955 PPI complaints in the last three months of 2010, which was 50% of the total number of complaints they had received and nearly twice the number lodged with it six months earlier. The increase is largely a result of the judicial review and banks failing to investigate claims properly.

If you think you have been mis-sold a Payment Protection Insurance policy, do not hesitate to contact us via www.ppireturn.co.uk.

MBNA Restructures its Credit Cards and FSCS burden IFAs with big levy

2011-02-07T02:08:00.000-08:00

In an effort to claw back some of money lost from sales of PPI, MBNA have restructured their credit card payment terms. On a selection of accounts, MBNA will expect customers to pay back at least 1% of their outstanding card balance per month, meaning someone with 5000 euros on their card would pay 50 euros per month rather than the current 7 euros. Its yet another example of banks tightening their operations in hard times and a by product of PPI mis-selling.

It was surprising to read (with the Judicial Review decision looming), that the Building Society Association was positively supporting the idea that compulsory mortgage payment protection insurance be added to accounts during the arrangement process. The idea is sound in that it could mean fewer repossessions and ease the burden on state benefits and housing, but inevitably, it will be added to mortgage accounts of customers who will not benefit from it.

The FSCS have imposed yet another levy on banks and IFAs to cover the cost of compensating customers. In particular, there has been major consideration of the need to support the huge gap in PPI mis-selling compensation and some IFAs are now found to be paying huge levies for the mistakes of others. It is unfortunate for some that these increases may continue over the next two financial years - especially as the funds are used for no other purpose but to protect firms which have made their money, are no longer trading, and need to be bailed out by others.

Finally, Martin Wheatley, the outgoing chief of Hong Kong’s financial regulator, will head the UK's new consumer champion authority (Consumer Protection & Markets Authority) when it is created next year. Mr Wheatley will join the FSA in September as managing director for consumer protection and markets. When the FSA is broken up at the end of next year, Mr Wheatley will serve as chief executive of the Consumer Protection and Markets Authority.

If you think you have been mis-sold a Payment Protection Insurance policy, do not hesitate to contact us via www.ppireturn.co.uk.

Judicial Review finished - awaiting a verdict

2011-02-02T05:27:00.000-08:00

So, the Judicial Review hearing finished on Friday and Judge Ouseley is going to be making his judgment shortly. We arent sure when this will be - some estimates have suggested Easter, but we are hoping for a quick decision.

Whether the Principles can be used in determination of future PPI complaints will have to be seen but there appeared to be a shift towards a more technical argument used by the BBA on how legal it was for the FSA to simply create the rules without getting feedback from the Treasury.

Despite the Judicial Review, we are still seeing offers arriving from a wide cross section of banks and would urge anybody to make a claim as soon as possible. The FSA has warned some of the banks for putting ALL of their claims on hold despite it being clear that not all will be affected by the Judicial Review. Some believe only a small number of complaints should be tied up by the JR and most of them should be investigated at the very least.

If you think you have been mis-sold a Payment Protection Insurance policy, do not hesitate to contact us via www.ppireturn.co.uk.

Project Kestral - Lloyds agrees to pay compensation

2011-01-24T08:08:00.000-08:00

Big story in the press this week centres around 'Project Kestrel'. Lloyds has launched a mass mailshot – to more than 230,000 Halifax customers offering possible refunds to customers who may have been mis-sold payment protection insurance on their credit cards. This outcome of 'root cause analysis' by the bank clearly has found significant failings in Halifax' processes during the sale of these particular policies and is limited to 2008 / 2009 sales.

The letters will prompt credit card customers to contact a special call centre operated by outsourcing firm Capita. I believe the centre will try to understand whether a customer was entirely unsuitable for the policy and award compensation accordingly. The article comes at an interesting time (just ahead of the Judicial Review, which begins tomorrow) and puts Lloyds in a more positive light despite its complete unwillingness to deal with its own PPI complaints.

I welcome the Association of Mortgage Intermediaries press release to its industry urging cooperation on Payment Protection Insurance complaints. Given certain lenders have decided to delay settlement of the majority of its outstanding claims, AMI's position appears fair and reasonable given the current climate.

We are still keen to continue pushing claims to settlement for our clients and should you wish to make a complaint, please contact PPI Return as soon as possible at www.ppireturn.co.uk

Natwest / RBS fined and Ombudsman continues to struggle

2011-01-18T06:30:00.000-08:00

Some statistics were issued last week by the Ombudsman in relation to their ongoing PPI complaint caseload. They have highlighted an unexpected surge in PPI complaints, not captured by their 2010 annual review. The Ombudsman expects to receive 68,000 complaints which is well above the 46,000 cases for which it budgeted. As a result, the Ombudsman expects to resolve a total of 180,000 cases during the current financial year, almost 15% down on the 210,000 it originally predicted.

The Ombudsman confirmed the high volume of PPI cases has contributed to a drop in its income (80% of which comes from case fees) because it has resolved fewer disputes as a result. Furthermore, they confirmed their reserves had been "significantly" reduced after the 40% jump in the number of PPI complaints. As a result it is expected to increase the industry levy as its reserves would be exhausted within six weeks if firms decided to stop co-operating on payment protection insurance complaints.

It was always clear FOS would be significantly backlogged with the amount of cases it had to deal with. It has no option but to investigate those claims in accordance with its statutory obligations, but the amount of Judicial Review based cases is clearly the main reason for its troubles.

Additionally last week, the FSA has fined Royal Bank of Scotland and its parent bank NatWest £2.8m for multiple failings in the way the banks have handled customers' complaints. The investigation and subsequent fine was NOT confined to PPI complaints - but to other complaints the bank investigated. We have noticed some particular failings with Natwest group on the way it deals with PPI complaints (most notably going over the 8 week timeframe to investigate cases and making poor offers of compensation). Hopefully, we will see further sanctions and fines bestowed upon the group for its dealings in PPI complaints.

If you think you have been mis-sold a Payment Protection Insurance policy, do not hesitate to contact us via www.ppireturn.co.uk.

CPMA gathers momentum and banks pay £40 million to customers

2011-01-05T04:41:00.000-08:00

Happy New Year !

The blog has been a little quiet over the last few weeks but quite a lot has happened in the PPI world over Xmas.

There has been a lot of views on the implementation of the new body (the Consumer Protection and Markets Authority CPMA). Essentially, it will replace the Financial Services Authority (FSA) as the organisation which will regulate financial businesses in the UK. Its been described as an organisation which will endeavour to be a 'Consumer Champion' and fight for the rights of the public. Whether the CPMA will provide that extra layer of protection will have to be seen to be believed. It is more than likely the organisation will be made up of the same individuals, at the same offices as the FSA - so we will have to see whether it will effect real change in the industry.

Another story mentioned over Christmas was that the banks have so far paid back £40 million to Mortgage PPI customers who were sold a policy, but the monthly premiums were unfairly increased during the recession to take into account the increased risk to the insurers. This meant customers who were told they would pay a set amount per month for the policy found themselves paying much more for the same insurance. The banks had until 30th June 2010 to make the refunds - but the FSA expected £60 million to be refunded, so this is quite substantially less than the amount expected.

The BBC also reported that banks were deliberately stalling claims and taking over the stipulated 8 weeks to investigate the cases. This means the Ombudsman's caseload increases significantly and takes even longer for the matters to settle. The reasoning behind this appears to be that some banks are refusing to analyse whether a case is subject to the terms of the Judicial Review and as such be suitable for a settlement.

A little more consideration on the particulars of the Judicial Review were assessed recently with the FSA and FOS both providing their responses to the BBA's application. The responses are detailed and look positive from a claimant perspective. The hearing is due to take place at the end of January 2011 with the decision probably due around spring time. I hope the High Court will dismiss the application without the further hearing, but we will have to see how this unfolds in due course.

If you think you have been mis-sold a Payment Protection Insurance policy, do not hesitate to contact us via http://www.ppireturn.co.uk/

Careful with some Claims Management Companies offering to write off debts

2010-12-12T10:15:00.000-08:00

Not a great deal of updates over the last week in the PPI world. We are awaiting the FSA / FOS responses to the BBA's Judicial Review which should be served very shortly. Although it will provide some more information about the particulars of the court application, I doubt it will provide any real clarity on whether the BBA will be successful.

I noted in the press last week of a customer of a Claims Management Company called Capital Returns. This customer was told she would have all of her debts paid off (£20k). As is becoming clear, those claims are turning out to be false and having paid £200 up front to the company, this customer feels very angry about the way in which they treated her.

PPI Return would always warn consumers looking to get out of any debt. If its too good to be true, then it probably is! Many of these claims management companies have now gone out of business leaving clients seriously out of pocket. PPI Return would always suggest making a PPI mis-selling claim as it is a much more likely route to obtain compensation.

I have also read about some US reports showing credit card providers are using an automatic "opt-in" policy for payment protection insurance. In the past, this appeared to be a post card upgrade, but now they have included it at inception. Its a shame providers are still using these tactics (regardless of where in the world it is being undertaken) to sign customers up to a PPI policy.

If you think you have been mis-sold Payment Protection Insurance, don't hesitate to approach us to make a claim at http://www.ppireturn.co.uk/

Judicial Review Update and FSA Backtracks on Rules

2010-11-28T08:52:00.000-08:00

We had some interesting updates in the world of PPI last week. The judicial review is still being considered, but it looks like we may be seeing the application heard at court towards the end of January. Most of the lenders are continuing to review cases, despite the JR, but we are still continuing to receive offers and so would urge people to continue to make claims.

The FSA also released a response clarifying some of the rules which they were intending to implement on the 1st December. The FSA felt the BBA may have misinterpreted some of the rules and so have issued some clarification. It is fair to say that the FSA have been pushed into this position as a result of legal advice and we await the BBA's response.

In terms of all the 1st December rules, it appears most banks are refusing to implement the rules until the Judicial Review has been decided. This doesnt mean that more claims will be placed on hold, but it does mean that the new rules on complaint handling cannot be brought in. We are however, confident that a proportion of claims will be continued to be investigated regardless.

If you think you have been mis-sold Payment Protection Insurance, don't hesitate to approach us to make a claim at http://www.ppireturn.co.uk/

PPI Complaints Popular - But People Still Want It

2010-11-21T14:36:00.000-08:00

Last week was a fairly quiet week in the PPI world, we are still awaiting some clarity and progression on the judicial review and are beginning to see how the banks are looking to deal with complaints.

I noted in the press last week that Capita Insurance Services have conducted a small survey into attitudes of PPI. It suggested that almost 30% of loan customers who have cancelled or are considering cancelling their payment protection insurance (PPI) would consider a replacement policy.

This of course is prudent (but surprising) information given the present wave of consumers claiming compensation from the banks. If any consumer is successful, it will have the effect of removing their PPI from their account. Of course, this leaves them at risk if they do have to take time off from work due to accident, sickness or redundancy.

It is always important to protect yourself in case you are unable to work and there are some excellent products on the market which will give you much more comprehensive cover.

If you think you have been mis-sold Payment Protection Insurance, don't hesitate to approach us to make a claim at http://www.ppireturn.co.uk/

Ombudsman Caseload Continues to Increase

2010-11-14T13:10:00.000-08:00

Once again, more statistics published last week confirmed what we all knew. Payment protection insurance complaints continue to make up a massive 45% of its ongoing caseload over the last 3 months.

I believe this figure will increase dramatically as the Ombudsman begins to receive complaints which banks will not investigate as a result of the judicial review. The Ombudsman will have to reallocate their staff to cope with the massive extra workload. Furthermore, even if a complaint is forwarded to the Ombudsman service, it is likely only a full decision in the customer's favour from an Ombudsman will compell a bank to pay any compensation. Such a decision from the top level of the service could take as long as 1 year to be realised.

However, we are still receiving a steady proportion of offers and payments and although certain banks have confirmed they are unwilling to deal with a selection of cases, we are confident that we will still be able to deal with cases despite the judicial review.

In another article this week, the FSA are keeping a keen eye on its members as they begin to trial new products. The FSA has cited they intend to take a proactive approach to risk management as they review these new products in an effort to avoid another 'PPI' scandal. Only with this positive approach to regulation can the FSA ever hope to keep their members in check.

If you feel you have been mis-sold PPI, dont hesitate to approach us to make a claim at http://www.ppireturn.co.uk/

Tyneside Couple Ripped Off

2010-11-07T14:06:00.000-08:00

Last week a couple, one of GE Money' customers from Tyneside won his battle for a refund of his Payment Protection Insurance which he believed had been wrongly sold to him.

He took out a loan for £15,000 and was told to take out a PPI policy with the loan at a cost of £2,250. This was added on top of the loan and interest was charged throughout the term of the account.

The worst thing about his situation was that after 5 years, the policy expired and GE Money were pushing him to pay more money to protect his loan for the remaining term ! Luckily, he was able to secure a full refund of the PPI by taking his claim to the Financial Ombudsman Service. However, he maintained it was a stressful, time consuming exercise.

At www.ppireturn.co.uk, we are able to take the stress out of claiming. In todays busy environment, our clients dont have the time, nor the knowledge to deal with their own complaints. PPI Return can assist you to claim back what is rightfully yours with the minimum of fuss.

In other news, we are a little further on with the Judicial Review. The Ombudsman has confirmed they will look into complaints where a bank has refused to look into our client's case if the matter has been left for the requisite 8 weeks. Additionally, the FSA appears aware of the methods some of the banks are using to cease the investigation of complaints and is pushing for the Judicial Review to be heard as soon as possible.

This does not mean you cannot continue to register your complaint. We are sure this is only a temporary setback and it is 'business as usual' for the majority of our clients.

If you feel you have been mis-sold PPI, then give PPI Return a call on 0800 877 8888. PPI Return is a division of Goldsmith Williams Solicitors.

Judicial Review ongoing and Banks Refuse to Investigate Complaints

2010-10-17T11:13:00.000-07:00

So, one week on from the the Judicial Review and no clearer as to what all the court action is really about.

All we know is that the banks are beginning to refuse to deal with PPI complaints - irrespective of the merit and in complete defiance of the FSA and FOS. There is still no confirmation of which cases the JR affect and the banks are even refusing to pay out on cases they have already offered compensation.

Our advice to consumers is to plough on regardless and not be put off by this latest ruse, even if the process may take a little longer. Sadly, this culture of opposition has been a feature of the PPI claim process throughout, from the endless claim forms to the rejection letters, and this is the latest instalment.

Coincidentally, this week saw the Competition Commissions ban coming into effect. Although the specific provisions may take a year to come to fruition, we can be safe in the knowledge that banks will be unable to sell PPI to consumers in the future. The Competition Commission acknowledged that the sale restriction would inconvenience some customers who wanted the insurance, but it argued that customers would be much better off overall.

If you feel you have been mis-sold PPI, then give PPI Return a call on 0800 877 8888. PPI Return is a division of Goldsmith Williams Solicitors.

Judicial Review Announced

2010-10-10T09:52:00.000-07:00

Big news this week with banks deciding to take legal action against the Financial Services Authority.

Although it has not been made entirely clear, it would appear the banks are particularly displeased with some of the new FSA rules concerning the handling of PPI complaints which will be put into force on 1st December.

Particularly, the rules suggesting previously denied complaints should be re-opened, investigated and paid out. Furthermore, the banks have been requested to undertake a proactive approach to contact customers who were sold PPI to see if they were mis-sold.

The action has not, and should not, affect any ongoing complaints – the FSA has made it clear it will not move to do so (like it did with bank charges).

We will continue to monitor the judicial review and report back with any further updates.

So - this changes nothing in the way in which cases will be dealt with in the foreseeable future and if you want to make a claim - contact PPI Return at http://www.ppireturn.co.uk/. PPI Return is a division of Goldsmith Williams Solicitors.

Banks make up lost profits from PPI

2010-09-26T11:01:00.000-07:00

A recent Bank of England report has suggested that banks are trying to significantly increase their profit margins by a number of different methods as they try to claw back lost profits from Payment Protection Insurance.

The report shows that while the rate the Bank of England charges banks was slashed to 0.5% from 5%, the interest rate banks are charging on personal loans and credit cards has risen to around 11% from 8.5%.

The banks have been criticised for failing to lend enough money to those who require it and charging higher rates to its existing customers. They say they have little choice as the higher rates they charge reflect the higher costs they have to pay in the wholesale markets.

Considering the banks have lost the PPI battle - it is a shame to punish other customers by hiking up interest rates. The banks were made an example of by making excessive profits from customers who needed finance and assistance. To punish all their customers as a result of that failing is unfair.

If you want to make a claim - contact PPI Return at http://www.ppireturn.co.uk/. PPI Return is a division of Goldsmith Williams Solicitors.

Ombudsman's Work Load Increases

2010-09-19T13:34:00.000-07:00

PPI Mis-selling claims are increasing very quickly. The Financial Ombudsman's has had to deal with 84,000 cases this year (the majority of which are concerning mis-sold PPI).

However, always remember that although there are many inadequacies of PPI, bad press which surrounds it many claims being made, people are being put off taking the insurance out.

As such, there are now thousands of financial consumers agreeing to loans, mortgages and credit cards without sufficient protection should they be unable to make repayments. This situation is has been worsened by the state of the economy with many people losing their jobs.

Now, more than ever, is the most important time to have an appropriate PPI policy and those without one are placing their credit rating, belongings and even their home on the line.

There are many excellent Income Protection plans on the market which are far better than the insurance that would have been sold on loans and credit cards.

So if you’ve been mis-sold insurance then make your claim but don’t disregard PPI altogether, when sold correctly it can help you get through times of financial difficulty.

If you want to make a claim - contact PPI Return at http://www.ppireturn.co.uk/. PPI Return is a division of Goldsmith Williams Solicitors.

Banks May Make Legal Challenge ?

2010-09-12T11:31:00.000-07:00

Not a great deal in the news this week about Payment Protection Insurance.

Perhaps all interested parties are still digesting the new FSA rules on how PPI complaints should be handled. The rules go some way to break down what is expected of banks whilst investigating PPI complaints. They are no longer able to rely solely on papers completed at the time the loan was sold. They must take ALL evidence, written or verbal into consideration when making their decision.

This means our clients will get a much fairer deal during their claims. The big banks will (hopefully) continue to pay out as they have done - leaving the more awkward defendants to try to wriggle out of paying up.

The rules also allow for a greater amount of compensation to be paid in some cases where a customer was not given a fair rebate and enhanced compensation for linked loan accounts. The rules are due to go live on 1st December.

On the other hand - there has been a report this week that the banks intend to mount legal action against the FSA on its decision to retrospectively apply its new rules to the banks' complaint handling operations. It will of course be interesting to see if there is any further development on this point in coming weeks.

FSA Makes New Rules

2010-08-30T12:25:00.000-07:00

Welcome to Burley's Blog. My thoughts for the week and every week as PPI continues to hit the headlines.

The most prominent changes of the week centre around the FSA's new changes in the way in which the banks must process PPI complaints from their customers. I believe it will change the way banks will deal with complaints, ultimately in a positive way, but we must be aware that some banks may use the new process to delay the progression of cases, thereby continuing to hold back money which belongs to our clients. Every bank must use the new rules from the 1st December and so they have been given some considerable time to implement the new rules.

We will continue to fight for our clients to get them the best deal regardless of how the banks choose to deal with the cases.

On another point, I note with interest the plight of a man in Dumfries, duped by a Claims Management Company suggesting they could write his credit card debt off. Goldsmith Williams have always aired on the side of caution when advising clients of their ability to write off their debts. There have been so many Claims Management Companies promising to help write debt off, but few appear to have succeeded on mass. Given the recent High Court rulings on the subject, it appears there is little chance in getting your debt written off and I expect the area to continue to decline.

As it happens, the CMC told their client that they offered a free service, but they charged £1,400 to tell him that he had never paid payment protection insurance and couldnt write his debt off.

If you feel you have been mis-sold PPI, then give PPI Return a call on 0800 877 8888. PPI Return is a division of Goldsmith Williams Solicitors.