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UK Couple’s Case Could Set New Precedent for PPI Claims

A couple who signed a £30,000 loan in 2004 inclusive of a £10,500 total PPI repayment cost might just change history before PPI claims end in 2019.

Paragon Personal Finance, which was earlier involved in another landmark PPI case with Susan Plevin, had received £7,985.46 commission from the PPI’s sale to the couple. As per Plevin’s case, it meant they had to refund the total value of the PPI policy the couple paid for in a decade.

St John’s Building’s Barrister Elis Gomer had warned about the Financial Conduct Authority (FCA)’s rules as initiating unfair recompense to consumers mis-sold PPI. He had said those who demanded their complete refunds saw cases resolved in private.

With another landmark case finished, the FCA is likely to integrate this new ruling against banks. Claimants who received less than their PPI’s total value can make a claim once again for the remainder.

The UK’s total for PPI recompense is at £40 billion. Experts expect it to rise more than 30% in the coming months before the 29 August 2019 deadline the FCA imposed in 2017.

Experts view the last year of PPI claims as highly stressful as its peak in 2012 or even more. The resources of the Financial Ombudsman Service, FCA, and other bank claim centres will take the biggest stretch before banks finally end and recover from the PPI fiasco.

FCA To Place CMCs Responsible For Unscrupulous Actions Learned From PPI Claims

The City watchdog has promised to put to light the unfair practices of some claims management practices and to enforce tighter rules in the industry that has made billions over the banking industry’s mis-selling of payment protection insurance policies.

In its published draft of CMC regulation, which it intends to pass on April 1, 2018, Chief Executive Andrew Bailey stated that CMCs are necessary to help provide justice and provide redress. The FCA designed the rules in a way that will root out poor conduct and make CMCs “trusted provides of high-quality, good-value services.”

Part of its new implementations talk of legitimate procurement of “lead lists,” which CMCs use to obtain a consumer’s name, and having to state the alternatives to claims services, such as the Financial Ombudsman in their marketing and pre-contract disclosures.

According to First4Lawyers’ Qamar Anwar, the tighter CMC regulation is a great step towards improving the sector’s reputation and performance. He believes the new rules will help the consumer navigate an “alien industry at a difficult time.” Anwar adds that CMCs will not be seen as “call centres with little regard for the well-being of those they’re trying to contact through cold calls and text messages.”

SIPP Scandal: The New Wave of Payment Protection Insurance

Self-Invested Personal Pensions or SIPP owners might find themselves making a claim for mis-sold pension investments in the next few years.

Claims management expert Rob Ridge from Money Redress stated Britons are unaware about the scandal surrounding SIPPs. He speculates it may deal further damage than mis-sold PPI as those mis-sold investments can receive a maximum of £50,000-£150,000 for every recompense.

Ridge speculates the SIPP scandal will reach heights above £10 billion, which is 25% of the £40 billion payout for payment protection insurance.

The mis-selling storyline happens as so: Financial advisers out to scam savers will promise them massive 20 per cent returns on their pensions reinvestment incrementing each year. The get-rich-quick scheme involves seemingly feasible investments such as airport parking spaces, holiday properties, and green energy projects.

While the saver receives an increment to their pensions, it is not as high as their initial investment. The agreement will never guarantee returns by the promised deadline.

Experts and observers found the SIPPs circumstances similar to the initial discovery of payment protection insurance mis-selling. Ridge believes the impact of the new scandal to the newly-recovering financial services industry is unprecedented.

PPI claiming is set to end on 29 August 2019. With the new scandal looming on the horizon, it is possible the industry’s consumer confidence rating will once again be at an all time low.

Clydesdale and Yorkshire Allocate £350m More For Mis-Sold PPI

Clydesdale and Yorkshire Banking Group (CYBG) saw its PPI figures increase to about 59,000 in the first half of the year. The National Australia Bank (NAB)-backed financial group is struggling to cope with its PPI repayments and has lost shares in the market.

Stock figures show the Glasgow financial institution losing about 6% of its shares after it told investors it needs to deal with “legacy PPI costs.” The huge £350m addition would mean a huge dent on its profit.

CYBG said its PPI figures increased after “heightened media coverage, the FCA advertising campaign, and increased claims management company activities.”

The bank acknowledged its PPI pool to increase in the coming years until 2019, the appointed date of the FCA’s claims deadline.

NAB will deal with £148m, but CYBG still takes a £202m pre-tax charge hit on its profits for the first half of 2018. Bank analysts claim NAB’s insufficient provisions is a “bit of a disaster” for the Glasgow-based financial institution.

PPI is the UK’s biggest financial scandal with almost every UK bank selling insurance policies to ineligible consumers. It has since reached the biggest refund pot of £40 million.

Recently, St John Building’s commercial barristers claim the FCA’s processes limit the actual figure Plevin claimants receive. Instead of the 100% PPI refund, the Watchdog’s procedures allow banks to pay as much as 20% only to PPI mis-selling victims.

PPI Complaints Doubled in Half a Year After FCA’s Ads

The notorious payment protection insurance with a deadline for claims on August 29, 2019 has gained traction among claimants after the ongoing yet successful FCA advertising campaign had urged consumers to make a claim for their mis-sold insurance policies.

The bizarre yet meaningful advertisement starring the voice and animatronic head of Hollywood legend Arnold Schwarzenegger has urged consumers to “do it now” and make a PPI claim to obtain their refunds. The advertisement calls for consumers to search for “FCA PPI,” which will then lead them to the City watchdog’s dedicated page for PPI mis-selling.

Complaint figures have reached about 2.21 million, 13,000 fewer compared to 2017’s first half, but nonetheless a huge improvement that will only increase as the PPI deadline approaches.

Meanwhile, MoneySavingExpert founder Martin Lewis believes the FCA’s advertisements are troublesome than they are helpful. He said asking for consumers to search particular keywords that claims management companies can hijack for advertisements will mislead consumers to CMC landing pages where they are led to believe reclaiming refunds requires payment.

In his algorithm test regarding the FCA’s instruction, he revealed that two of the top-tier results of the initial page using the key phrase mentioned had revealed two CMCs who had funded the advertising for the keywords.

Martin Lewis: UK PPI Adverts Are Misleading

The Financial Conduct Authority’s PPI claims commercial featuring the animatronic head on tank treads and the voice of Hollywood Star Arnold Schwarzenegger has seen great success. However, MoneySavingExpert founder Martin Lewis said the advertisements are misleading. He believes the advice provided can trap consumers into paying for their PPI claims.

The commercials featured Schwarzenegger’s disembodied head walking on tank treads telling consumers and bus passengers to “do it now” and make a claim for their mis-sold insurance policies. However, it commands consumers to search Google for “FCA PPI” instead of providing an actual URL directly to the FCA’s PPI page.

Lewis said search engine algorithms will use this keyword to display primary advertisements from claims companies who would charge a substantial fee if they can make your complaint gain success and refunds. In search engines, organic unsponsored results often appear below one or two company advertisements related to a particular keyword.

PPI is the biggest UK financial scandal in history. It has gained the bank industry over £40 billion in refunds and penalties. About £25 billion had been returned to consumers. The FCA has made its decision in March 2017 to impose a PPI claims deadline by August 29, 2019. All complaints performed after this date will not receive any support from the regulator.

 

PPI Advertising Campaign Includes Its Second Episode

Arnold Scwharzenegger’s voice was used for his animatronic, tank-tread walking head urging indecisive customers in a supermarket to “do it now” and decide.

His dialogue is an allegory to the massive UK PPI scandal set to end on August 29, 2019. Recently, it had added a second episode.

The bizarre, disembodied head is seen crawling in a bus telling people to “do it now” and make a claim for their mis-sold insurance policy.

PPI is the United Kingdom’s biggest financial scandal. It has accumulated more than £40 billion in payments made by ineligible customers.

Banks had refunded over £29 billion in the last few years.

The Financial Conduct Authority continues to produce and air its M&C Saatchi-produced commercials until the PPI claims deadline.

Funding for the Schwarzenegger-backed commercials came from FCA-imposed bank levies, which amounted to £42.2 million in total.

UK’s banks continue to struggle with payment protection insurance repayments with most banks having reached a total of £5 billion repaying mis-sold consumers.

Lloyds Banking Group takes almost half the PPI scandal’s total with over £19 billion earmarked and half of the amount repaid to consumers.

According to the FCA, consumers will no longer receive its support if they attempt to make a PPI claim after the deadline.

How to Avoid Getting Mis-Sold PPI and Any Other Financial Product

Banks have started pulling the plug on publicising their protection products especially payment protection insurance. The notorious insurance policy that had left millions trying to claim back worth £3,500 of payments continues to plague the UK’s financial industry. To avoid facing the same issues in the future with other financial products, here are three things you need to keep in mind.

Do You Really Need It?

If you’re taking out financing, make sure to check your credit scores beforehand. A check allows you to see if the industry is confident in your ability to make repayments for a new loan or mortgage. Doing so allows you to see if you really need any PPI or insurance policy that repays your financing.

No Specific Brand

If bank employees tell you a specific insurance policy is needed for a financing and your credit scores indicate you have a below-average risk rating, then you must take out a policy. However, the bank cannot specify a policy they offer or any brand they refer to explicitly. A single insurance product cannot qualify all customers in the same way.

Read The Terms and Conditions

Lastly, before taking out a financial protection product, see if the product’s terms and conditions make you eligible to make a claim should you need it. Millions of UK consumers mis-sold PPI were ineligible upon purchasing their insurance. While majority of these cases were due to unscrupulous sales tactics, it is better to be safe than sorry by reading the terms and conditions before leaving a signature.

Morgan: FOS Guilty of Mishandling PPI Claims Unless It Proves Otherwise

Treasury Select Committee Chairman Nicky Morgan said that the Financial Ombudsman Service, British Consumer’s final defence against unscrupulous financial products and sales tactics, must present evidence else it is guilty of mishandling PPI complaints in favour of banks.

A Channel 4 undercover journalist team showed that FOS employees giving into stress and huge workloads did not initiate proper detailed investigations, which led to poor decisions for mis-sold PPI claims.

The Ombudsman’s decision on lender and borrower dealings is final and cannot be reversed.

According to Morgan’s letter to FOS Chief Ombudsman Caroline Wayman, the FOS needs to reopen cases “it feels were not decided correctly.” She also asked Wayman for the number of people affected by the improper case handling.

Employees from the FOS said they did not pore over every detail as they should because of the huge number of pending claims they need to address. Most employees fear missing out on pay rises and promotion opportunities because of immense backlogs, leaving them to make half-detailed decisions on their investigations.

The FOS itself said in a statement that the programme can always be improved and a review by the non-executive board to clarify the concerns raised is encouraged.

The Ombudsman receives about 4,000 complaints on a weekly basis. In the past, it had upheld 7 out of 10 complaints in the favour of consumers.

PPI Claims: How to Address an Unfairly Rejected Claim

Banks and financial institutions can and will reject valid PPI policies. Even if you have strived to gather enough data to support your claim, financial institutions can shoot down your complaint citing data deficiency on their end. Their claim is unfair, therefore, you can redress these abusive bank behaviours with the following.

Data Access / Credit Score Request

Banks can cite the six-year customer data clause to bypass your activity during your financing’s early days. However, a data access or credit score request can reveal all your activities and show all the repayments you’ve made for your financing.

Speak to the Financial Ombudsman

The Financial Ombudsman can conduct a complaint review and make a final decision on your complaint. However, the complaints processing might be slow because you will resubmit to the FOS your complaint and wait a few more weeks for the results.

Make a Petition

If the bank rejects your complaint despite your evidence that they had mis-sold your policy, then you can make a petition to take the financial institution to court. However, this process may take some time. Therefore, it is advisable that you only use this in dire circumstances or if you have multiple mis-sold PPI policies.