PPI Claims on Hold as legal action taken against FSA

[Heatman]

I am livid, incandescent with rage!

 

The BBA have started high court action against the FSA over new PPI rules due for Dec 1st.

 

Spoke to Barclays about my claim today and they have told me all complaints relating to PPI are now on hold.

 

Are we being stiched up like we were with Bank Charges? I think so... and are we going to roll over and let it happen again?

[afee12345]

are you refering to this:

 

http://news.bbc.co.uk/1/hi/programmes/moneybox/9074699.stm

 

that is good news for the consumers

[dx100uk]

really on hold

 

tell barlclays to actually read the bba's own guidelines p'haps:

 

The Financial Services Authority says banks would be expected to keep handling complaints about PPI while the review was ongoing and said where consumers were unhappy they should refer the complaint to the Financial Ombudsman Service (FOS).

 

typical sharkeys bank

 

anything to wriggle out of paying up

 

dx

[afee12345]

are you refering to this:

 

http://news.bbc.co.uk/1/hi/programmes/moneybox/9074699.stm

 

that is good news for the consumers

 

last sentence should had read good news for the banks bad news for the consumers.

 

does anyone know what the new rules are imposed by the FSA

[Heatman]

lol, do you not remember the bank charges debacle? apparently the OFT were on our side

 

apparently the FSA are on our side this time... dont fear... hahaha

 

all over! and deep down you all know it!

[kennythecelt]

From BBA web site.

 

http://www.bba.org.uk/media/article/ppi-factsheet

 

Payment Protection Insurance (PPI)

11/10/10

 

Why the BBA is bringing a judicial review

 

What is PPI?

 

PPI is an insurance product which covers the risk of a borrower being unable to repay their borrowing.

 

It typically covers accident, sickness, unemployment and life cover, but the detailed terms and conditions of different policies will vary. It is usually paid for either as a single up front premium (usually added to the amount of the underlying loan provided) or by separate monthly instalments.

 

Until recently, banks offered to arrange PPI for customers alongside their credit applications.

 

What is the case about?

 

This judicial review is not simply about PPI: it is about the ability of the Financial Services Authority (FSA) and Financial Ombudsman Service (FOS) to apply new standards to old sales.

 

The FSA recently published a policy statement and open letter to the industry advising they should consider complaints about PPI not just by reference to the detailed conduct of business rules which applied at the time but also to standards that are based on the FSA’s guiding principles for doing business. The BBA has applied to the Courts for a judicial review of (i) the FSA’s approach contained in its policy statement, and (ii) the Financial Ombudsman Service’s approach to PPI sales complaints contained in its guidance.

 

We believe the FSA is effectively creating a precedent which permits it to apply new rules to previous sales – even where those sales were regulated by other FSA rules.

 

Therefore this ruling might not only affect customers who have bought PPI, but might also set a precedent that could affect all products regulated by the FSA.

 

I have lodged a mis-selling complaint with my bank. What will happen to this complaint?

 

The banks are currently discussing with the FSA how best to handle complaints whilst the judicial review is ongoing.

 

How long will this all take?

 

The BBA is working with the FSA and the FOS to ensure that these matters are resolved as swiftly and fairly as possible. The industry felt that there was no alternative but to go to judicial review, as discussions with the FSA and the FOS have not enabled the issues to be resolved.

 

The specific day that the judicial review will be heard is ultimately a matter for the Court to decide but we are hopeful that time can be made available within the next few months or the early part of 2011.

 

Payment Protection Insurance (PPI) Factsheet

Print this article Bookmark

[kennythecelt]

FSA advises consumers to keep complaining if you were mis-sold PPI.

 

From the Financial Services Authority

 

http://www.fsa.gov.uk/Pages/consumerinformation/product_news/insurance/payment_protection_insurance_/ppi_changes/index.shtml

 

 

PPI changes challenged: Can you still complain?

 

If you have insurance to cover your loan or debt repayments in the event of accident, sickness, reduced income or loss of employment, you can still complain about how the policy was sold to you or the response you received after making a claim. Find out how.

 

If you have taken out a loan, mortgage or credit card, you may have been sold payment protection insurance (PPI) to cover the repayments if you are unable to meet them in certain circumstances.

 

These policies can also be called loan protection, credit protection, or accident, sickness and unemployment insurance.

 

It may have been suggested to you that you needed PPI to be approved for a loan or credit, or even had a policy added to the amount of your loan without your knowledge, increasing the balance you have to repay.

 

Consumer protection challenged

We took over the regulation of insurance sales in 2005, and since then have found evidence of widespread problems with the sale of PPI and how complaints are handled.

 

To ensure customers are treated more fairly when complaining about the sale of a PPI policy or after making a claim, we announced a package of measures for firms to follow by 1 December 2010.

 

These measures include:

 

ensuring firms handle complaints properly and offer redress where appropriate;

explaining when and why firms should review past complaints to identify if there are serious flaws in sales practices that may have affected customers who bought PPI; and

setting out common sales failings to help firms identify bad practice.

What’s happened now

The banking industry, through trade association the British Bankers' Association (BBA), started legal proceedings on 8 October 2010 to challenge our ability to insist on these measures.

 

We intend to contest this challenge as we consider the measures to be a fair solution for consumers and the industry.

 

What to do if you have a complaint

Despite the challenge by the BBA, you still have the right to complain about your PPI policy.

 

If you have a complaint about the circumstances of the sale of your PPI policy or the suitability of the product for you, you should first complain to the firm that sold it to you.

 

If your complaint is about a claim you have made, you should raise the matter with the insurance firm.

 

You are more likely to get a prompt response if you follow the firm’s complaints procedure – you can check online or call to confirm how they prefer you to proceed.

 

The firm then has eight weeks to look into your complaint and provide a response.

 

If you are not happy with how the firm has dealt with your complaint you can take it to the Financial Ombudsman Service as soon as possible and within six months of receiving a response. The ombudsman service is a free, independent service for settling disputes between financial services firms and their customers.

 

The ombudsman service has a template to register a complaint about PPI which you can send to the firm that sold you the policy.

 

Find out more about what to do if you have a dispute or complaint.

 

Fairness failings

We have taken action against 24 firms for failings in PPI sales since 2005, with fines totalling nearly £13m. We also stopped the sale of single premium PPI with unsecured personal loans so consumers won’t pay upfront for several years of protection.

 

The quality of complaints handling is another area of PPI we have focused on.

 

In the past five years there have been over a million complaints made about PPI. Firms on average reject around half the PPI complaints they receive, but some reject nearly all the complaints, according to figures we received from 18 major sellers of PPI.

 

Nearly one-third of rejected complainants go to the ombudsman service, where more than 80% are overturned in the consumer’s favour.

Edited October 11, 2010 by kennythecelt

[kennythecelt]

Whilst there appears to be feedback that some banks/ financial institutions may have instructed their staff that PPI claims are on hold in view of the BBA's decision to challenge the FSA, the advice is to continue to complain if you feel you have been mis-sold PPI and pursue a claim for a refund. Those institutions may have been a bit hasty with that stance.

 

No waivers have been granted by the FSA to any seller of PPI and the FSA continue to expect all complaints submitted to financial institutions regulated by them to be processed in accordance with their guidance. If you have difficulties, then after 8 weeks you can submit your complaint to the Financial Ombudsman Service who require to investigate on your behalf.

 

Please post if you experience difficulties and CAG will continue to assist and monitor the situation.

[kennythecelt]

Article from todays Telegraph regarding Lloyds group decision to place PPI claims on hold until after the review.

 

http://www.telegraph.co.uk/finance/personalfinance/insurance/incomeprotection/8059528/Lloyds-snubs-FSA-as-it-puts-PPI-claims-on-hold.html

 

 

Lloyds snubs FSA as it puts PPI claims on hold

 

Lloyds Banking Group, Britain's biggest bank, has collided head-on with the regulator by putting all customer complaints about mis-sold payment protection insurance (PPI) on hold until a forthcoming judicial review is heard.

 

By Emma Simon

Published: 4:04PM BST 12 Oct 2010

1 Comment

The Financial Services Authority has reiterated that it expects all banks to continue handling customer complaints while the inquiry is under way.

But other banks are expected to follow Lloyds' lead. One bank employee admitted: "We haven't quite pulled the ladder up yet on these complaints, but it isn't exactly business as usual either."

 

Barclays confirmed that it was reviewing its PPI complaints handling process, while HSBC and Royal Bank of Scotland said discussions were under way between the British Bankers' Association (BBA) and the FSA on how PPI complaints should be dealt with in the interim.

 

Santander said it would continue to deal with all PPI complaints.

 

These moves follow the decision by the BBA to seek a review of new FSA rules on how banks deal with PPI complaints. These rules, due to come into effect on December 1, would force banks to review millions of older PPI cases against new standards, which are designed to put a stop to highly pressurised sales.

 

According to Martin Lewis of Moneysavingexpert.com, these reviews could lead to compensation for up to 3m customers, costing some £2bn.

 

In a statement, Lloyds Banking Group – which includes the Halifax and Bank of Scotland brands – said: "While we wish to resolve all complaints quickly, it is now very difficult to know exactly how to handle a PPI sales-related complaint.

 

"Since the court challenge by the BBA is likely to take some time to come to a conclusion, the BBA is talking urgently with the FSA and Financial Ombudsman Service about how best to handle complaints during this period. We hope that they will be able to come to an agreed position soon."

A spokesman added that customers could still log complaints about PPI, but they were unlikely to be resolved until the judicial review was complete. The review is not expected to be heard until April at the earliest.

 

But it is not expected that the FSA will grant a "waiver", effectively allowing all banks to "freeze" complaints, as happened when there was court action pending over the legality of unauthorised bank charges. At the time it was agreed that such charges were a legal grey over, with no precedent set by either the courts or an Ombudsman's test case.

 

In contrast, there have been numerous investigations, directives, guidelines and enforcement actions surrounding the sale of PPI, the first of which was in 2006. The FSA has taken action against 24 companies over PPI failings, and there have been more than 1m mis-selling complaints.

A spokesman for the FSA said any bank customer who believed their complaint was not being handled correctly would be free to take it to the Financial Ombudsman Service.

 

Recent figures published by the FOS show that it upheld more than 80pc of customers' complaints about mis-sold payment protection insurance.

 

PPI has been routinely sold alongside loans and credit cards, offering to protect repayments if the borrower is unable to work. However, while the banks earned substantial commission payments for selling these policies, many failed to explain the small print, which meant that some buyers would never have been able to make a valid claim.

 

In addition, premiums were often bundled into the cost of the loan, making it difficult for customers to compare costs properly.

 

If you have a claim in with your bank and they now say they have stopped processing it, get that in writing and immediately lodge a complaint with the Financial Ombudsman Service. DON'T WAIT FOR THE 8 WEEK COMPLAINT TIME LIMIT.

 

If you have a letter from them offering a settlement figure and they subsequently decide not to pay out, immediately proceed to FOS, with copies of all correspondence.

 

If you are submitting a new claim and they subsequently inform you they will not deal with it, get it in wring and proceed to FOS. DON'T WAIT FOR THE 8 WEEK COMPLAINT TIME LIMIT.

 

You have the option of taking any complaint to FOS after the 8 week period but remember claims take a long time for investigation at FOS and time for subsequent payout by the bank due to their delay tactics.

Edited October 12, 2010 by kennythecelt

[Heatman]

where is everybody on this site?

 

this is big current news and nobody seems to be discussing it?

 

have they all abandoned ship for another site????

[kennythecelt]

Banks fight FSA crackdown on PPI

 

Basically states Lloyds have stopped processing, during the challenge, and other banks are expected to follow. All of this goes against FSA jurisdiction. Quite amazing and shows us, if we were ever in any doubt, what the banks think of regulation, the law and their customers.

 

 

Financial Times

 

http://www.ft.com/cms/s/2/8ec1da2c-d623-11df-81f0-00144feabdc0.html

[kennythecelt]

Hi Heatman

 

what stage is your claim with Barclays at? Have they confirmed they will not process your claim in writing? If not, I suggest you get confirmation in writing ans then proceed to FOS. Remember that will take time. However, I think its important to get it lodged there quickly if thats what you have been told.

 

Hopefully, this will be resolved quickly and in claimants favour. However, nothing would surprise me now.

 

Good luck and keep us posted.

[kennythecelt]

Banks drag their feet on protection insurance

Bankers slammed over PPI attitude

 

article on Which http://www.which.co.uk/news/2010/10/banks-drag-their-feet-on-protection-insurance-233300/

 

cracking quote from their Chief Exec

 

Banks drag their feet on protection insurance

Bankers slammed over PPI attitude

 

 

11 October 2010

 

 

The Financial Services Authority (FSA) will contest the British Bankers’ Association’s (BBA) judicial review of the payment protection insurance (PPI) complaints handling measures.

 

Which? chief executive Peter Vicary-Smith has criticised BBA for its support of a product that has been consistently mis-sold over the years. The Financial Ombudsman Services (FOS) has recorded thousands of complaints relating to PPI. It is a major campaigning area for Which?.

 

The PPI problem

Banks will be expected to continue handling complaints while the complaints process is in progress. If customers don’t think their complaint has been handled properly, they can refer it to the FOS.

 

There have been more than a million PPI complaints over the last five years. In 2009/2010, the FOS received 49,196 complaints. Nine in ten were found to be in favour of those making the complaint.

 

The FSA believes that the package of new complaint handling measures outlined in its policy statement is a 'sensible and fair solution for consumers and the industry alike'.

 

Which? acts on PPI

 

Peter Vicary-Smith said: ‘It makes you wonder what planet the banks are living on. Not content with the billions they have made from this overpriced, flawed and frequently mis-sold product, the banks now seem to be trying to wriggle out of implementing changes that would ensure consumers are treated fairly. The BBA's taxpayer-backed members should take a long, hard look at themselves and ask why they continue to wage this ridiculous war on consumers.

 

[kennythecelt]

Interesting article this on new powers for the FSA which ironically come into play today: (for some reason FSA site down at present)

 

http://citywire.co.uk/wealth-manager/fsa-gains-collective-redress-powers/a439181

 

FSA gains collective redress powers

 

by Iain Martin on Oct 12, 2010 at 15:43

 

 

The Financial Services Authority (FSA) has been granted the power to force businesses to establish collective redress schemes to compensate consumers and publicise enforcement actions earlier.

 

The power was created by the Financial Services Act 2010 and activated today along with others changes to the regulator. The FSA will use collective redress schemes where there is evidence of widespread failings following large numbers of claims made to the Financial Ombudsman Service over issues like Payment Protection Insurance.

 

‘This is an important new tool for the FSA, which increases our ability to get redress for consumers when firms have not followed our rules,’ said Sally Dewar (pictured), managing director of risk at the FSA. ‘The power would obviously be used proportionately. It is not a substitute for working with industry where there is the potential to bring an issue to a fair and speedy conclusion.’

 

The FSA has also acquired the power to publish decision notices ahead of final notices, which means that it can publicise enforcement actions rather than waiting for the Financial Services and Markets Tribunal to process appeals.

 

The Financial Services Act 2010 also removes the FSA’s statutory objective to promote public understanding of the financial system following the establishment of the Consumer Financial and Education Body.

[kennythecelt]

Article on banks refusing to process claims for PPI until result of judicial review. Santander buck the trend.

 

http://www.dailymail.co.uk/money/article-1320011/Banks-court-fight-PPI-claims.html?ito=feeds-newsxml

 

 

 

Banks go to court to fight PPI claims

By JAMES CONEY

Last updated at 1:23 AM on 13th October 2010

Comments (0)

Add to My Stories

Thousands of borrowers sold rip-off payment protection insurance (PPI) will have their claims put on ice, Money Mail understands.

It follows a High Court bid by the banks to overturn rules by the City watchdog that could lead to hundreds of thousands of pounds in refunds.

Banks will put on hold any complaints which relate to this legal case. This is likely to mean anyone complaining about how they were sold PPI will have to wait until the court case is resolved; other complaints will be dealt with as normal.

 

PPI payment: The FSA has proposed new rules which could lead to compensation for hundreds of thousands of customers

But, at the same time, Santander has become an unlikely consumer champion and has declared it does not support the legal action started by trade body the British Bankers' Association (BBA).

The City watchdog Financial Services Authority (FSA) has proposed new rules which could lead to compensation for hundreds of thousands of customers whose complaints about payment protection insurance (PPI) have been rejected. But the BBA believes the demands are illegal and wants them investigated by a judge.

 

More...

Do I need to agree to PPI to get a loan? {thisismoney.co.uk}

End looms for PPI as Lloyds ends sales {thisismoney.co.uk}

Mortgage rates are dropping as lenders compete in shrinking market

Among those supporting the BBA's legal bid are state-backed Royal Bank of Scotland and Lloyds Banking Group.

An estimated 300,000 borrowers who were missold PPI - a type of insurance sold with loans and credit cards - are being fobbed off by the banks every year. Some of Britain's biggest banks have had to refund millions of pounds in premiums to consumers.

Around eight in every ten complaints about the insurance is upheld by the independent Financial Ombusdman Service.

 

A spokesman for the BBA says: 'It has unfortunately been necessary to do this because there is insufficient legal clarity about what the FSA and ombudsman are proposing. No one wants to go to court but the law needs to be clear.'

 

To complain about your State-backed bank taking part in this legal action, call RBS on 0800 0150319, and Lloyds on 01733 387599.

 

 

Read more: http://www.dailymail.co.uk/money/article-1320011/Banks-court-fight-PPI-claims.html?ito=feeds-newsxml#ixzz12DBHP8B6

Edited October 13, 2010 by kennythecelt

[kennythecelt]

More from the Express

 

http://www.express.co.uk/posts/view/205015/Banks-aim-to-block-insurance-refunds

 

 

BANKS AIM TO BLOCK INSURANCE REFUNDS

 

 

Some card holders have already received payouts

 

Wednesday October 13,2010

By Esther Shaw

Have your say(0)

CONSUMERS who believe they have been mis-sold loan insurance by their banks are being urged to act fast to claim compensation.

The call comes from campaigners after news that the banks are to challenge forthcoming rules on controversial payment protection insurance (PPI) policies.

The British Bankers’ Association (BBA) has filed papers with the High Court asking for a judicial review of some decisions made by City watchdog, the Financial Services Authority (FSA).

 

Lloyds Banking Group, which includes Lloyds TSB, Bank of Scotland and Halifax, said it was putting any complaints currently in the pipeline on hold while it sought clarification from the FSA over how to deal with them.

 

There are fears other banks could follow suit, leaving thousands of mis-selling victims in limbo. PPI is designed to pay out if customers can’t meet credit card, loan or other repayments, perhaps due to illness or redundancy. Campaigners say the cover is overpriced and widely mis-sold.

For example, many borrowers have been wrongly told the cover was a precondition for having their loans approved. In August, the FSA published new measures aimed at fairer treatment of customers buying PPI and better handling of complaints.

 

The FSA announced the crackdown, which included guidance on paying redress and when firms should review past mis-selling complaints, following rejection by the banks of tens of thousands of complaints about the policies.

 

The watchdog gave firms until December 1 to adopt the new rules. However, the BBA has now decided to launch a legal challenge against the measures.

The BBA is contesting the FSA’s measures on the basis that this could open the door for retrospective regulation and could set a precedent which might then be applied to other products.

 

The industry fears the regulator could force banks to pay redress for past sales practices which were not specifically outlawed at the time.

“It has unfortunately been necessary to do this because there is insufficient legal clarity about what the FSA and Financial Ombudsman Service (FOS) is proposing in this area,” said a BBA spokesman.

 

The FSA has said it will contest the BBA’s judicial review and that it expects banks to continue handling PPI complaints while the process is still ongoing.

 

Campaigners are urging consumers who have considered complaining to act quickly. At present, the FSA is allowing them to continue seeking refunds, and the FOS is still hearing cases.

 

“If you’ve put in a complaint and had an offer made, you should be safe,” said Lucy Widenka, personal finance campaigner for Which?. “We urge anyone affected to take action as soon as possible.”

 

The concern is that if the courts were to rule in favour of the BBA and the banks, securing compensation could become difficult once again.

The FSA said it expected firms to continue to handle complaints, but Lloyds is suspending its current cases.

 

A spokeswoman for Lloyds said: “We will stand by any settlements that have already been made. The court case will not affect those offers. However, we are putting PPI sales-related claims on hold while we talk to the FSA. We hope this will only be for a few weeks.”

 

It added that customers can still lodge complaints in the normal way.

 

FURY AT 'RIDICULOUS WAR ON CONSUMERS'

According to recent Financial Services Authority figures, in the last five years there have been more than a million complaints made to firms about payment protection insurance.

 

Figures also show that in 2009-10 customers referred 49,196 complaints to the Ombudsman which then upheld nine out of 10 in the complainants’ favour.

 

“It makes you wonder what planet the banks are living on,” said Which? chief executive Peter Vicary-Smith. “Not content with the billions they have made from this over-priced, flawed and frequently mis-sold product, the banks now seem to be trying to wriggle out of implementing changes that would ensure consumers are treated fairly.

 

“The British Bankers’ Association’s taxpayer-backed members should take a long, hard look at themselves and ask why they continue to wage this ridiculous war on consumers.”

 

Which? has set up a free online complaints service for consumers to make their complaint: http://www.which.co.uk/ppiclaim.

Edited October 13, 2010 by kennythecelt

[kennythecelt]

From the telegraph today.

 

 

http://www.telegraph.co.uk/finance/personalfinance/insurance/8059659/Lloyds-risks-FSA-clash-over-customer-PPI-complaints.html

 

Lloyds risks FSA clash over customer PPI complaints

 

 

Lloyds Banking Group is risking a clash with the regulator by putting some customer complaints about mis-sold payment protection insurance (PPI) on hold until a forthcoming judicial review is heard.

 

By Emma Simon

Published: 6:30AM BST 13 Oct 2010

 

 

Lloyds risks FSA clash over customer complaints

 

The Financial Services Authority (FSA) reiterated that it expected all banks to continue handling PPI complaints during this legal process.

Others banks, including Barclays, HSBC and Royal Bank of Scotland said yesterday they were reviewing their PPI complaints process;

 

But a statement issued by the British Bankers' Association (BBA) last night said only claims "directly impacted by the judicial review" would be delayed.

 

Last week the BBA announced it was seeking a review of FSA rules on PPI complaints.

 

These rules, due to come into effect on December 1, would mean banks have to consider millions of PPI complaints against new sales standards, designed to stop highly pressurised sales tactics. This could lead to compensation for up to 3m customers, costing some £2bn.

Lloyds Banking Group, which includes Halifax and Bank of Scotland, said while it was talking to the FSA and the Ombudsman it had "no option but to put complaints on hold."

 

But the FSA is not expected to grant a general "waiver" effectively allowing banks to freeze complaints, as it did during legal action on bank charges.

 

But the BBA statement indicates the FSA may accept some complaints will be delayed. Banks are required to tell customers if they complaint is affected by this review.

 

Over the past five years the FSA has issued 24 separate enforcement procedures over PPI failings.

 

The FSA said dissatisfied customers remained free to take their case to the Ombudsman, which currently settles around 80pc of such cases in the consumer's favour. PPI is routinely sold alongside loans and credit cards, but these policies can be expensive and riddled with exclusions.

[kennythecelt]

Latest update from BBA

 

http://www.bba.org.uk/media/article/payment-protection-insurance-complaints-handling

 

 

Payment Protection Insurance - complaints handling

13/10/10

 

"The BBA's members will continue to handle all PPI-related complaints in accordance with FSA rules. Where the the assessment of the complaint would not be affected by the judicial review, these complaints will be handled in the normal way. If your complaint will be impacted by the judicial review, and cannot be resolved at this point, then your bank will write to inform you.

 

"Customers should be assured that all complaints will be reviewed - even those delayed by this judicial review process. There is no deadline for receipt of complaints. If customers have a problem regarding PPI they should contact their bank and, if necessary, complain in the normal way."

 

 

Updated factsheet from BBA http://www.bba.org.uk/download/5709

 

Payment Protection Insurance (PPI)

 

Why the BBA is bringing a judicial review

 

What is PPI?

 

PPI is an insurance product which covers the risk of a borrower being unable to repay their borrowing.

It typically covers accident, sickness, unemployment and life cover, but the detailed terms and conditions of different policies will vary. It is usually paid for either as a single up front premium (usually added to the amount of the underlying loan provided) or by separate monthly instalments.

Until recently, banks offered to arrange PPI for customers alongside their credit applications.

 

 

What is the case about?

 

This judicial review is not simply about PPI: it is about the ability of the Financial Services Authority (FSA) and Financial Ombudsman Service (FOS) to apply new standards to old sales.

 

The FSA recently published a policy statement and open letter to the industry advising they should consider complaints about PPI not just by reference to the detailed conduct of business rules which applied at the time but also to standards that are based on the FSA’s guiding principles for doing business. The BBA has applied to the Courts for a judicial review of (i) the FSA’s approach contained in its policy statement, and (ii) the Financial Ombudsman Service’s approach to PPI sales complaints contained in its guidance.

 

We believe the FSA is effectively creating a precedent which permits it to apply new rules to previous sales – even where those sales were regulated by other FSA rules.

 

Therefore this ruling might not only affect customers who have bought PPI, but might also set a precedent that could affect all products regulated by the FSA.

 

C:\Documents and Settings\brian.mairs\Desktop\PPI factsheet 131010.DOC 13 October 2010

 

I have lodged a mis-selling complaint with my bank. What will happen to this complaint?

 

The BBA's members will continue to handle all PPI-related complaints in accordance with FSA rules. Where the the assessment of the complaint would not be affected by the judicial review, these complaints will be handled in the normal way. If your complaint will be impacted by the judicial review, and cannot be resolved at this point, then your bank will write to inform you.

 

Customers should be assured that all complaints will be reviewed - even those delayed by this judicial review process. There is no deadline for receipt of complaints. If customers have a problem regarding PPI they should contact their bank and, if necessary, complain in the normal way.

 

How long will this all take?

 

The BBA is working with the FSA and the FOS to ensure that these matters are resolved as swiftly and fairly as possible. The industry felt that there was no alternative but to go to judicial review, as discussions with the FSA and the FOS have not enabled the issues to be resolved.

 

The specific day that the judicial review will be heard is ultimately a matter for the Court to decide but we are hopeful that time can be made available within the next few months or the early part of 2011.

 

British Bankers’ Association

 

Wednesday 13th October 2010

[kennythecelt]

It appears Barclays have followed Lloyds according to

 

http://www.mortgagestrategy.co.uk/loans/barclays-latest-lender-to-defy-fsa-on-ppi/1020128.article

 

Barclays latest lender to defy FSA on PPI

13 October 2010 | By Natalie Thomas

 

Barclays has become the latest lender to defy the Financial Services Authority and put on hold any complaints regarding Payment Protection Insurance that might be impacted by the forthcoming judicial review.

 

Yesterday, Lloyds Banking Group announced that customers can continue to log their complaint with the bank but no decisions will be made concerning sales related PPI complaints whilst the judicial review is ongoing.

 

Today, Barclays, owner of former secured loan lender First Plus, has revealed that it is putting a portion of its complaints on hold as well.

 

A spokeswoman for Barclays, says: “All PPI-related complaints will be reviewed as we receive them - if they are impacted by the issues covered by the judicial review and therefore cannot be resolved at this point then we will write to the customer to inform them of that.

 

“Complaints on matters not affected by the judicial review will be assessed in the normal way.”

 

The British Bankers Association has applied to the courts for a judicial review of the FSA’s complaint handling approach.

 

The BBA says the FSA’s procedure for PPI complaints risks setting a precedent which will allow the regulator to apply new rules to previous sales for any financial product.

 

The FSA recently published a policy statement and open letter to the industry advising they should consider complaints about PPI not just by reference to the detailed conduct of business rules which applied at the time but also to standards that are based on the FSA’s guiding principles for doing business.

 

This could result in more than 2.5 million people being refunded as much as £2.7bn in total.

 

Santander however says it will continue to deal with all PPI complaints.

 

The BBA says: “We believe the FSA is effectively creating a precedent which permits it to apply new rules to previous sales – even where those sales were regulated by other FSA rules.

 

“Therefore this ruling might not only affect customers who have bought PPI, but might also set a precedent that could affect all products regulated by the FSA.”

 

The BBA says it has been necessary to take action because there is insufficient legal clarity about what the FSA and FOS is proposing in this area.

 

The FSA says it will contest the British Bankers’ Association’s judicial review of new PPI complaints handling measures.

 

The FSA says in the last five years there have been more than a million complaints made to firms about PPI. In 2009/2010 alone, customers referred 49,196 complaints to the Ombudsman which then upheld nine out of ten in the complainant’s favour.

[kennythecelt]

Praise for Santander's stance on PPI

 

http://www.thisismoney.co.uk/credit-and-loans/ppi-mis-selling/article.html?in_article_id=516367&in_page_id=506&position=moretopstories

 

Opinion by Tony Hazell

 

13 October 2010

 

The Daily Mail's Personal Finance Editor gives his view on another shameful action by banks on payment protection insurance. Only one bank stands out from the crowd...

 

Congratulations to Santander for standing out against the traditional banks in their latest bid to ride roughshod over consumers.

The Banking Bullies Association has launched a Judicial Review over the FSA and Financial Ombudsman's approach to payment protection insurance mis-selling.

 

The FSA and Ombudsman simply want the banks to treat their customers fairly.

 

The concept of fairness apparently has no meaning to those inhabiting the corridors of Lloyds, Barclays, HSBC and RBS, so they are demanding a legal definition.

 

But Santander has other ideas and has the courage to stand out against this latest attempt to batter consumers. This is a statement of intent by the bank to treat its customers fairly on all occasions.

 

Those whose complaints are fobbed off by others should take note.

[kennythecelt]

Update from the BBC

 

http://www.bbc.co.uk/news/business-11532197

 

 

Hundreds of thousands of claims for compensation for mis-sold loan insurance will be put on hold for months until a legal wrangle is over.

 

Banks will delay old claims relating to the sale of payment protection insurance (PPI), the British Bankers' Association has announced.

 

These cases will only be completed at the conclusion of a judicial review into the issue, it said.

[kennythecelt]

Same issue- update from Financial Times

 

 

http://www.ft.com/cms/s/2/7da0f454-d6ae-11df-98a9-00144feabdc0.html?ftcamp=rss

 

 

Lenders put PPI complaints on ice

By Josephine Cumbo

Published: October 13 2010 12:24 | Last updated: October 13 2010 12:24

 

Tens of thousands of consumers who have lodged payment protection insurance (PPI) mis-selling complaints face delays in having their disputes resolved as banks mount a legal challenge against new complaint handling rules.

 

The British Bankers’ Association (BBA) the industry body, said on Wednesday that complaints which would be directly impacted by its request for a judicial review “cannot be resolved at this point”.

 

The announcement comes days after the Financial Services Authority, which is contesting the judicial review, ordered banks to continue handling PPI claims while the legal challenge was underway.

 

The BBA said its members “would continue to handled all PPI-related complaints in accordance with the FSA’s rules”, but those whose outcome would be affected by the legal challenge would be treated differently.

 

“There will be some complaints which will be directly impacted by the judicial review, and which cannot be resolved at this point,” said the BBA. “If your complaint is among these, your bank will write to inform you.”

 

However it added: “Customers should be assured that all complaints will be reviewed - even those delayed by this judicial review process.”

 

The BBA did not make clear which claims might be put on hold.

 

But some legal firms, which deal with PPI compensation claims, say all their claims have been suspended.

 

“We called Lloyds for an update on an existing claim and they basically said that we are not doing anything at all with existing claims while the judicial review is taking place,” said James Kafton, chief executive of PPI Claimline, a compensation claims firm.

 

“It’s very difficult to know what to tell customers as the FSA said that it expected complaint handling would be unaffected by the judicial review.”

 

Another claims company said thousands of its customers claims had been left in limbo.

 

“We have been told that all our existing claims have been put on hold,” said Mike Ransom, managing director at Investor Compensation, a claims firm.

 

“The lack of clarity about how these claims should be dealt with is alarming.”

 

Lloyds Banking Group, which includes Lloyds TSB and Halifax, and HSBC, the world’s biggest bank, have pubically stated that they back the BBA’s line.

 

Santander, the Spanish-owned bank, however, is not getting involved in the legal action being pursued by a number of UK banks and said “we will continue to deal with any issues our customers put to us regarding PPI in accordance with FSA rules.”

 

PPI is designed to cover loan repayments for unsecured debts in the event of accident sickness or forced redundancy.

 

However, since the FSA took on regulation of PPI in 2005 it has taken enforcement action against 24 firms largely for mis-selling.

 

In the last five years there have been more than 1m complaints made to firms about PPI. In 2009/2010 alone, customers referred 49,196 complaints to the Ombudsman which then upheld nine out of ten in the complainant’s favour.

 

The FSA said it “strongly” believed that a package of new complaint handling measures, announced last year, was a “sensible and fair solution” for consumers and the industry alike.

 

The FSA said: “We repeat that firms are expected to continue handling complaints while the judicial process is ongoing customers,” said the FSA.

 

“Customers who are unhappy with the way their complaint has been dealt with can take their cases to the Ombudsman.”

[kennythecelt]

http://www.bankingtimes.co.uk/2010/10/13/ppi-complaints-handling-delayed-by-judicial-review/

 

PPI complaints handling delayed by judicial review

by Gill Montia

 

Story link: PPI complaints handling delayed by judicial review

 

The British Bankers’ Association (BBA) looks set on a collision course with the Financial Services Authority (FSA), having said it will only continue to handle Payment Protection Insurance (PPI) complaints where the assessment of the complaint would not be affected by the outcome a judicial review launched earlier this week.

 

The BBA has filed papers with the High Court asking for a judicial review of some decisions made by the FSA and the Financial Ombudsman Service, in relation to PPI.

 

It is contesting proposed new rules on complaints handling due to be implemented at the end of this year, stating: “Everyone’s actions must be assessed on the basis of a proper understanding of the relevant law and regulation and this procedure will bring this about.”

 

The FSA has responded, by promising a vigorous defence and added that, in the interests of consumers, firms will be expected to continue handling complaints while this process is ongoing.

 

The BBA has, however, assured consumers that all complaints will be reviewed “even those delayed by this judicial review process”.

 

According to the regulator, in the last five years there have been more than a million complaints made to firms about PPI and in 2009/2010 alone, customers referred 49,196 complaints to the Ombudsman who then upheld nine out of ten in the complainant’s favour.

[kennythecelt]

This is looking like a re run of the OFT bank charges saga.......................................

 

 

UPDATE FROM MSE

 

http://www.moneysavingexpert.com/news/reclaim/2010/10/banks-join-lloyds-in-freezing-ppi-claims

 

Banks join Lloyds in freezing PPI claims

Guy Anker

News Editor

13 October 2010

 

 

Lloyds Banking Group has been joined by many of its rivals in freezing payment protection insurance (PPI) claims.

 

The move is in defiance of Financial Services Authority (FSA) rules which state all claims must be heard while a landmark legal case on PPI reclaiming is ongoing (see the Banks' PPI block MSE News story and PPI Reclaiming guide).

 

Barclays, HSBC and Royal Bank of Scotland have confirmed they will put complaints on hold pending the result of a case brought by the British Bankers' Association (BBA) to block moves by the FSA to ensure millions of mis-selling victims receive payouts that could top £2 billion.

 

Only Santander, of the major banks, will still hear complaints. It is also refusing to support the legal case.

 

A statement today from the BBA, which is leading the banks' campaign to freeze claims, says not all complaints will be put on hold by its members.

 

But its executive director Eric Leenders, speaking to MoneySavingExpert.com, accepts the majority will be frozen.

 

The BBA says the FSA is aware of its move and has offered no resistance.

 

When quizzed on the matter, the FSA reiterated a statement issued on Friday which said: "In the interests of consumers, firms will be expected to continue handling complaints while this process is ongoing."

 

PPI is designed to cover loan or credit card payments if you cannot work but it has been mis-sold for years. Some 24 firms have faced FSA action and over one million consumers have complained over the past five years.

 

What complaints will be frozen?

 

The BBA and the banks stress it is impossible to give specific examples of what cases will be put on hold.

 

The issue centres on the fact the BBA is arguing, as part of the legal case, that its members have been required to follow FSA rules on PPI sales yet the FSA only clarified what is expected of them this year, and now expects banks to have followed those updated guidelines in the past.

 

The BBA says this is unfair as the regulator is applying regulation retrospectively.

 

For this reason, it wants to block FSA rules, due to come into practice in December, that force lenders to contact those sold in a similar fashion to victims who have already got compensation. It's thought almost three million people could be entitled to compensation under this ruling.

 

So, where banks believe consumers are complaining about mis-selling that falls under the new FSA guidelines, the case will go on hold. But as this is so vague it could give them free rein to put most cases on hold.

 

The BBA statement says: "Our members will continue to handle all PPI-related complaints in accordance with FSA rules. Where the assessment of the complaint would not be affected by the judicial review, these complaints will be handled in the normal way.

 

"If your complaint will be impacted by the judicial review, and cannot be resolved at this point, then your bank will write to inform you."

 

What can consumers do?

 

As things stand, the Financial Ombudsman Service, the independent arbitrator, is still hearing complaints. You must complain to your bank and wait until a firm rejection, or if the issue has not been resolved within eight weeks, before involving the Ombudsman.

 

A whopping 81% of consumers who complain to the Ombudsman on PPI win their case. Yet only an average of 5% of rejected complainants, across all product sectors, take their case to the arbitrator.

 

Were banks to win the case, reclaiming could end, so don't delay in making a claim. An initial result is expected in early 2011 though the loser is likely to appeal.

[Heatman]

scammed again ?