PPI claim with Welcome Finance and FSCS reply

[jonjohnson]

Hi,

 

great site and garnered a lot of info, so thanks.

 

However this complaint seems to be a little non-standard.

 

Long story short

 

my brother was lucky enough to get into a loan with Welcome Finance back in late 2006.

 

He managed to get himself into some financial stiicky pudding due to an ex and ended up turning to them for finance.

 

He had the loan which he kept mainly up to date until he ended up with some arrears in 2008.

He failed to deal with these straight away ( osterich syndrome) and Welcome finance threatended him with a CCJ,

But due to his job as a mortgage adviser he could ill afford bad credit.

 

he spoke to Welcome finance and they said that if he did not pay the arrears that they would proceed to CCJ and it had to paid that day.

However they then said that if he went into a branch to discuss it that they may be able to roll up his arrears into the loan.

 

he promptly visited the Chatham branch and they agreed the lone for him there and then.

The adviser left the room and told my brother he needed to get it signed off by his manager.

 

When he returned he told my brother that they could lend him the money but due to his arrears the only way they could justify the loan was to insist that PPI was taken.

 

my brother was put in a situation that if he chose not to take the PPI on the loan they would not lend him the money and give him a CCJ,

however if he did take the loan he had to take the PPI.

 

there was no choice as he was more fearful of getting the CCJ.

 

he took the loan and the PPI.

 

This in my eyes is deemed a conditional sale which is not allowed.

 

he continued without choice.

 

He has since complained to Welcome finance and obviously the claims are now dealt with by the FSCS. He has supplied a good breakdown of the events.

 

However the FSCS have thrown the claim out as they state that he was a mortgage adviser and it would be expected that he would know that PPI was optional.

 

He admits freely he knew that it should be optional,

however Welcome finance were the ones who made it conditional on the loan and the FSCS's stance is that he should not have enetered intot he contract.

My argument is that this loan was made under duress by the threat of a CCJ for failure of payment. In this instance the PPI was sold conditionally.

 

The other fact is that although he was a qualified mortgage adviser he was not qualified to sell PPI himself and had never sold PPI on mortgages as he was not regulated to sell it or indeed trained on it.

 

Does this sound like a good enough case to retry on and get the case reopened.

If you are like me you are probably reading it and saying " stupid boy" as i have to admit i was unsympathetic originally,

but he is young and debt etc can make people do sily things,

hindsight is a beuatiful thing, but now we are trying to right what was wronged back then by Welcome finance.

 

I would appreciate any help with this or routes i should investigate. We have also requested information using Data protection rules, but still not forthcoming.

 

thanks in advance for any help

[ims21]

Hmm tricky one.

 

I am not sure that just because he was a mortgage advisor there shoud be an automatic assumption that he was well versed in insurance as well.

 

The fact remains that he was told that he must have the PPI to get the loan and I think that point needs to be emphasised again.

 

Of course the FSCS guys were not there at the point of sale so they have no idea what went on so they are assuming something which they could not possibly have any knowledge of.

 

If it were me I would write back and ensure that these three points are highlighted to them and ask them on what basis they make their assumptions.

 

If they still refuse then I fear that your only other course would be court action where the onus of proof of mis-selling would be on your side as the claimant (civil burden on the balance of probability)

[citizenB]

I would say yes, it is fairly obvious that this was Blackmail pure and simple and FSCS are being disingenuous.

 

Just because your brother was a Mortgage advisor does not mean that he has any knowledge of PPI and as you say, he was not trained in the product sale anyway.

 

I will alert the PPI guys on the site team, for their input as well.

 

Well I would have done.. but he beat me to it

[jonjohnson]

Ok thanks,

 

This is what i was afraid of. Its terrible as i know from expeience ( 6 years as a complaince officer for an IFA) that if this sort of case hit me as a complaint i would on evidence struggle to defend it and i know that if a case with this sort of situation fell to FOS ( financial ombudsman) i towuld fall in favour of the client. However as i have feared for many years, once a company is in default and the FSCS become liable the amount of recourse for a customer suddenly become a lot less and the decision process does weaken.

 

I need to really take some time it seems and contstruct the responce firmly. As i know from dealings witht eh FSa it is not the done thing to assume a clients understanding of the product based on their job. Unless he was a a professional client or a sophisitcated investor ( which rarely happens in loan contracts) he should be afforded the same level of protection as any retail client.

 

If we have no success with the FSCS doe sJudical review mean we could fight this ina smal claims court based on the amount of premium paid for the policy in dispute?

 

thanks again

[ims21]

I think the first thing to do is to calculate the claim amount.

 

Is the agreement and record of repayments available?

 

Do you have access to a copy of the FSA Handbook on PPI claims handling (being that you are close to the profession)?

[dx100uk]

can i just check

 

was this THE FSCS or was it the 'old welcome finance staff' on the welcome PPI division/line

operating under the FSCS guidance?

 

there is a BIG diff.

 

eitherway though

 

he was def mis-sold it

 

as already pointed

 

they can SPECULATE all they wish

 

THEY WERE NOT THERE IN THE ROOM.

 

dx

[jonjohnson]

This was what was aurprising, it was old Welcome staff handling on behalf of the FSCS.

 

a procedure i was not even aware existed, kind of like asking a mugger to take the witness statements on behalf of the police in my opinion.

 

I will have a look at the Handbook with regards to the PPI processes. Some causla christmas reading it seems

 

i do have a great deal of experience in complaint handling and procedures for IFA and stockbroking and i was a Bank manager with Mortgage underwriting and advising background

( back in the good old days when we underwrote mortgages properly without credit references and computer based decisions) for one of the better lenders pre regulation.

 

I also take on a lot of complaints myself personally .

 

So i will try to give back tot he site where ever i can as in the past fews years i have managed to helpe freinds and family with complaints regarding cold calling,

mal administration etc and even heleped get two cars rejected to car dealers.

 

But this is my first forray into PPI claims, in fact based on what freinds have said about random letters and getting compensation without even complaining

i did not expect this genuine case to be so rigourously defended.

 

iw ill keep all updated, but thanks for help thus far, its good to know that i'm not looking at this one with "brotherly Bias"

[dx100uk]

yu obv have the know how and p'haps the contacts.

 

you need to contact THE FSCS

 

and complain about how the 'welcome staff operatign under their guidance' have acted.

 

this is not the first case of this kind of answer that has been reported on

 

dx

[jonjohnson]

thanks i have just read thrugh DISP app 3.3 on the Handbook. The first 4 point have all been ignored, esepcially releiance on terms and conditions and small print.

 

Heads buzzing now as i think i have enough there to respond. I also will reverify this guys identity as looking at their responce it does look even more that the reponse has been drafted by a welcome employee due tot he language used and the use of underlinhing ( i kid you not) of certain words to draw emphasis. Not something i would genuinely exepect an FSCS or FOS emplyee to do as i usually grant with better than average skills at communicating. I would never dream of underlining a word in a complaint response.

 

Thanks for the tip on the handbook guidance, it seems the handbook can on occasions be useful....lol

[intend]

how corrupt is this - Welcome staff advising on this - should be stopped immediately but realise no chance of this.

[dx100uk]

when this came around

 

we on CAG accepted that what they were saying was correct

 

i'e ANY refund is only 90% & it MUSt go off ANY outstanding welcome debt, regardless of any rules.

 

i wonder how TRUE this really is & if the real FSCS ordained it officially - i'm doubting this now...dx