The City watchdog had written that “serious” breaches in bank ethics and conduct had Lloyds commit overcharging against many customers. The breach of PPI rules set in place by the Financial Conduct Authority in 2011 may have Lloyds see huge fines in the coming days.
According to the Competition and Markets Authority, Lloyds overlooked sending hundreds of customers their yearly financial statements — with some having incorrect information that consumers had paid. The CMA estimates about 200 customers overspending on their PPI premiums due to Lloyds’ error.
Consumer groups and claims companies were concerned as Lloyds’ issues might bring up other troubles in the 18 biggest PPI mis-selling banks in the United Kingdom, which could mean the £40bn bill is still short of the actual total mis-sold PPI bill. Lloyds had faced a fine of £117m in 2015 for mishandling PPI complaints.
Whether or not new fines could arise for Lloyds, it can still minimise its expenses given the leniency of the FCA as it intends to impose a PPI deadline. Using a marketing and advertising campaign, the FCA intends to inform all consumers possibly mis-sold PPI to come forward and make a claim. Consumer groups said the deadline was unfair for consumers as banks are still unable to improve its processes for PPI claiming.