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FCA 'disagrees' with 60% of smaller banks PPI claims

30th September 2013

The Financial Conduct Authority said a survey of medium-sized banks had found problems with the way many of the lenders dealt with PPI complaints.

According to the report, the regulator said it “disagreed” with the way two thirds of the 18 banks surveyed had rejected claims for compensation for mis-sold PPI policies.

Where these banks had offered redress, the FCA said it had concerns with 43% of the offers made to victims, adding the firms “did not display a genuinely holistic approach” to dealing with the claims.

“We expect firms to deliver fair outcomes to PPI complainants. In our review, we found that some firms are doing this while it is clear others still have some way to go,” said Clive Adamson, director of supervision at the FCA.

The firms surveyed account for about 1m complaints, or approximately 16pc of the total brought against the banking industry. According to the FCA these firms have so far paid out £1.1bn in compensation.

In total, banks have put aside nearly £12bn against PPI mis-selling and in July paid out £528m in compensation, up from £498m in June. The July payout was the first in excess of £500m this year, highlighting the continuing scale of the problem for lenders.

The FCA is currently conducting a larger study into complaints handling by the major high street banks, which are responsible for 80% of all claims.

The reviews followed an undercover investigation by reporters at The Times that uncovered evidence of serious failings in the way staff at a complaints handling centre dealing with PPI claims against Lloyds Banking Group were dealing with complaints.

Lloyds has put aside more money than any other bank to cover PPI claims.

Source: The Telegraph


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Posted in Financial Conduct Authority, PPI, PPI Complaints, Banks, Compensation, Mis-sold PPI, Complaint Handling, Lloyds Banking Group

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