April 4, 2014

Claims Management Companies Earned £5 Billion from PPI Claims

Category: Finance — Tags: , , , , – admin @ 6:17 am

Consumer rights charity group Citizens Advice said that claims management companies or CMCs earned a total of £5 billion in 2013 persuading consumers to allow them to make a PPI claim on their behalf. According to the group’s research, more than 28% of people who used a PPI CMC did not know how to make a PPI claim or they did not know what PPI was in the first place.

Citizens Advice blamed the failure of banks to call on consumers who may possibly be mis sold PPI. According to ex-Chief Ombudsman Natalie Ceeney, banks have “dragged their feet”, allowing CMCs to take the position on calling upon consumers possibly mis sold a payment protection insurance policy.

The Financial Ombudsman said that consumers could make a PPI claim without the help of claims management companies, yet some consumers thought that CMCs were representatives from the Ministry of Justice tasked to find consumers mis sold the financial product.

Many consumers also found more trouble working with rogue PPI claims management companies. Some consumers complained their CMCs charged up-front fees despite signing a contingency fee (no win no fee) contract. Consumers also mentioned some CMCs did not clarify the fee structure of their services.

The Ministry of Justice had recently depopulated CMCs by revoking the license numbers of 200 rouge claims accused of cold calls, illicit text messages and unsatisfactory services.

June 7, 2013

Total PPI Compensation Payout Now at £9.3 Billion

The Financial Conduct Authority estimates that the total compensation awarded by the financial industry to individuals have now reached a total of £9.3 billion. This year, a further £409 million was paid to consumers by April. The FCA continues to update the total amount of PPI compensation given to customers.

According to the FCA, Barclays is the bank that customers mostly complain about with 414,302 grievances. However, it is Lloyds that has the biggest share of the PPI compensation package. The banking group has paid £5.4 billion in total for compensation to customers. However, in terms of customer services, Lloyds only had 348,386 complaints.

According to the Financial Ombudsman, they are receiving at least 2,000 claims on a daily basis, with almost 86% of the PPI claims they receive favouring the customers. Chief Ombudsman Natalie Ceeney points out that banks might have a system that favours their compensation provision amounts rather than fair customer services. Reports about banks “tightening their PPI claims criteria” had Ceeney report the issue to the Financial Conduct Authority.

Ceeney also estimates that there might be no shortage of PPI compensation complaints this year. The FOS estimates that there might still be a remaining 40 million PPI claims in the country waiting to be filed and to receive compensation.

February 20, 2013

Lloyds Receives £4.3 Million Fine for PPI Redress Delays, Adds £1 Billion to PPI provision

Category: Finance — Tags: , , , , , – admin @ 4:18 am

Industry giant Lloyds Banking Group recently received a lashing from the Financial Services Authority because of their delays in providing customers their PPI redress. Around 140,000 customers waited for more than 28 days to six months in receiving their compensation. Lloyds says that its delays are a result of their underestimation of the PPI mis selling intensity in the United Kingdom.

Lloyds also apologised to customers for the delays. The Financial Services Authority noted that the bank could not come up with any explanation to customers about the delays when consumers followed up on their PPI claims. The regulator also found out that Lloyds’ PPI repayment system is below their standards.

The bank is also the leader in the PPI compensation provisions, with a whopping £5.3 billion. Practically, this makes almost 50% of the total compensation bill, which is around £13 billion. Lloyds has also earmarked an additional £1 billion for PPI claims as they continue to earn higher numbers of PPI claims.

The group is also involved in a recent scandal involving the mis selling of interest rate swap products to different business and companies, to which they provide a compensation amount of £24 million.

Former Lloyds Boss Eric Daniels, who brought most of the PPI troubles to Lloyds during his term, said that half of the claims Lloyds receives were not legitimate claims. He points at bank consumers saying that they file bogus claims to increase the compensation amounts. However, the Financial Ombudsman disproves Daniels’ point as their estimate tells them 3 out of 4 Lloyds-rejected claims are actually valid claims.

December 3, 2012

PPI Crisis: Things You Should Know

The Financial Services Authority has now appointed then-FSA managing director Martin Wheatley into the boss of the Financial Conduct Authority. The FCA’s job is consumer protection, which means Wheatley and the new watchdog would be analyzing business models, banking metrics and other details of business to prevent or avert a future financial meltdown as immense as the payment protection insurance crisis.

The Financial Ombudsman is now receiving at least 400 PPI claims an hour and is planning to increase their manpower to 3000 employees by the end of the year. The Financial Ombudsman chief Natalie Ceeney had also proposed for a no-claims payout, meaning that customers can get their compensation without having to make a claim. This is to make things quicker as banks are “dragging their feet” to address the situation, according to Ceeney.

Confederation of British Industry Director-General John Cridland called for a deadline to stop the increasing costs of PPI claims and financial damages to banks. He proposed a six-year deadline for all claimants contacted or aware that they are mis sold PPI. Cridland says that CBI agrees that customers must be compensated, but at least 30% of the money goes to the claims management companies.

The total PPI compensation package is now at £12.96 billion. Lloyds has £5.3 billion set aside for PPI compensation. Next to them is Barclays with £3.7 billion, RBS with £1.7 billion, HSBC with £1.32 billion and Santander with £550 million. Experts estimate that with compound interests piling up more than six years with most customers, the PPI compensation bill can reach about £16 billion by the next year.

Charles Dunstone, the Carphone Warehouse co founder, believes that the mis selling of payment protection insurance policy was not too widespread and banks only consented to compensate because they were unpopular. Experts and the media were not convinced by his statements. Lloyds CEO Antonio Horta-Osorio stated that the PPI crisis happened because banks lost sight of their core values and became non-customer focused and inefficient.

August 13, 2012

Mis sold PPI and Payment Protection Fraud

Category: Finance — Tags: , , , – admin @ 5:39 pm

Hardly any other financial product like PPI has procured such an ill status in the recent past. It would not be however justice to blame the policy and its features being responsible for the fast denial of this product. Vendors have mis-utilized this cover years after years. People have obtained mis sold PPI policies beyond their control.

Quite contrast to this picture, there remains some benefitted customers of this product. This policy served them extensive at times of recession. These people have been conscious buyers of the product and fortunately could utilize the benefits extended by the policy during their hard times.

Many people show interest in knowing how PPI policies became unpopular in the recent times despite such an earlier fame. Every new day a new mis sold PPI claims arise from the policyholders. Millions of missold PPI holders have claimed their policies back from the lenders.  An overall rage has been created against the lenders and this financial product.

You may feel keen to know why lenders pursued such practice. Two factors fundamentally tempted lenders in selling the missold PPI products to the borrowers. First, most of the financial organizations are more attentive in recovering all unsecured loans without fail as events of bankruptcy and non-payment reached peak during recessions.

Including PPI with loans, fulfill this objective effectively. On the other hand, PPI products generate immense profit for lenders as for most consumers this insurance remain unutilized. They have thus followed every means to club PPI with the unsecured loans. To some borrowers they explained PPI is obligatory with loan and to others they sold the policy even without any particular information.

July 24, 2012

PPI Reclaiming is Easier Now – See ClaimingBackPPI.com

Reclaiming PPI is easier now when compared to previous times. The main factor why the PPI claims have become convenient is that the UK government has recognized the claims of the missold policyholders. Previously, reclaiming PPI was not permissible and for this, the rate of successful claims had been essentially poor. Now, the government has banned illicit selling of the Payment Protection policies and has authorized the claims of the missold PPI holders as well. Also, there is information such as that at ClaimingBackPPI.co to help you.

You would be astonished to know that only 20% people managed to make a positive outcome of the Payment Protection previously. Creditors turn down the mis-sold PPI claimants on various objectionable grounds. Especially people who bought the policies consciously and reclaim it later were failure to obtain reimbursement most of the times. Reclaiming PPI was not legitimately acceptable at that time. Now you can assign a PPI solicitor and approach your lenders directly. However, you need to know and clarify how PPI has been missold to you.
T
he UK government had to accept the situation created by innumerable missold Payment Protection policies. Amount of missold policyholders is more than 20 million at this moment in the UK alone. Moreover, banks and other similar financial organizations have made PPI almost phenomenon with most of the unsecured loans. Either they induce the borrowers in accepting the PPI policies along with the loan or they sell the same in guise even without taking consent of the borrowers. This was to be stopped. Thus, the government has enacted laws prohibiting this type of deceitful selling of PPI.

July 20, 2012

Financial Advisers: Clear Culprits of Mis Sold PPI

It is estimated that a great part of the the millions of citizens mis sold PPI –  has commission based financial advisers to blame for such fiasco. The mis selling of PPI, discovered by the Financial Services Authority (FSA) in 2005, became one of the worst financial problems that UK ever faced. PPI is supposedly a beneficial product. Like all insurances, it works properly. However, given the manner that it was sold by bank representatives, insurance brokers and other financial advisers, it became notorious for extorting at least £3000 per customer.

Payment Protection Insurance (PPI) is designed to provide 12 months of loan, mortgage or credit card repayments in case the customer needs to take weeks or months off from work to recover from their accident injuries or sicknesses. The PPI provides the same benefits for those who get unemployed during their loan repayment term. The PPI only guarantees the benefits given that the customer is in perfect employment and health status and has a steady income rate

Financial advisers are the main culprits of mis sold PPI. Using their financial expertise as a backdrop to scheme for higher commission, they advised many customers that the insurance policy would benefit them. In reality it would, if the customers were only in perfect health and were employed. Millions of UK’s retired, unemployed, self-employed and those having pre-existing medical conditions cannot make a claim for the insurance benefits.

Banks have topped up the amount of the nationwide PPI compensation package to £5 billion. In 2011 alone, given the establishment of the new claims guidelines, millions were able to claim from the £1.9 billion paid out by banks for mis sold customers. The consumer group Which? has finally settled with PPI providers and banks to allow customer to make a claim for themselves in an easier PPI claims process.

However, the amount you get might not actually be the amount that you should get. Consulting with a claims expert is highly advised as they can see to it that all the details of your claim are in order. You can consult with them regarding what you need to get back all the repayments you deserve. If you find that you don’t have time to make your own claim, they can do it for you on a no win no fee basis – for more information on reclaiming PPI, visit www.ppiclaims.co.

June 14, 2012

Reclaiming Your Repayments From a Mis Sold PPI

You have probably heard the news about millions of UK citizens being mis sold PPI. You might have opted to make a claim but you do not know where to begin. Making a PPI claim is how you can reclaim the ten thousands of pounds you’ve paid for a mis sold insurance policy. Making a PPI claim is actually simple, yet you will need time and effort to invest in making your claim successful. The first things you need to know is how you were mis sold PPI and how you are initially ineligible for its requirements.

Knowing your eligibility is a start. PPI or payment protection insurance is any insurance policy that provides loan repayments for customers who find him or herself unable to repay loans due to financial troubles caused by taking a leave from work to recover from accidents or illnesses. Virtually anything that causes problems with your income flow, even unemployment during the loan repayment term, allows the PPI to provide 12 months worth of repayments. The PPI requires that upon purchasing the insurance, the buyer was employed and had perfect health.

The way you were mis sold PPI is the second part of the particular task. Insurance brokers, bank representatives and other commission-based financial advisers are responsible for mis selling millions of PPI to the country. Playing on the trust of their customers while motivated to ensure a sale with their highest-priced insurance product, they only explain the positive aspects of the PPI policy and then rationalize how it makes the financial situation of the customer better. Most victims of mis sold PPI are customers with multiple financing.

In your claim, you must thoroughly explain how you were mis sold PPI by your financial adviser and why you were initially ineligible for the insurance policy. You can highlight these particular information in the PPI claims form. It is advised that you seek the help of a ppi claims company like www.ppiclaimuk.co.uk in filling up the PPI claims form. Most claims experts provide free consultation for claimants.