The UK PPI Claims Scandal
Over the course of the last six or so years, if you have taken out a new credit card, personal loan, home loan or home refinance and you reside in the United Kingdom the chances are you are paying for Payment Protection Insurance (PPI) either knowingly or unknowingly. PPI is meant to be a insurance policy that will make your payments for your debts in the event you become unable to work due to injury, lay off or illness. The problem with it is that millions of consumers were sold it inappropriately, and it has resulted in one of the largest financial scandals in the United Kingdom.
What brought this to light was that the Citizens Advice Bureau reported to the Office of Fair Trading that approximately 85% of consumers whom filed to receive repayment of their monthly debt due to unemployment were denied their ppi claims from the insurance company. Upon further investigation into these dealings it was found that millions of borrowers were paying for PPI when they were not eligible to receive compensation in the event they needed it.
The Financial Services Consumers (FSA) began investigating, only to discover how widespread the mis-selling was. Billions of dollars in fines have been given to financial institutions due to this. Regulations have been set forth as well, however, many are still to this day not abiding by them. Consumers were advised to gather their information and file a complaint with their lender to reclaim ppi payments by citing the reasons why they feel they were missold.
Most lenders would and still continue to reject the complaints stating they did no wrong and sending a rejection letter to the borrower. At this point, the borrower can ask the Financial Ombudsman’s Service (FOS) to further their case, or make use of an expert UK ppi claims company. It has been shown that out of all the rejected complaints approximately 80% are likely to win compensation if mis-selling is proven.
A few of the most common practices of mis sold ppi tactics are as follows:
- Being told that the cover was mandatory to receive the loan.
- Employment status at the time was retired, self-employed, part time employment.
- Not being asked about medical history, many conditions will make you ineligible.
- In many instances ppi was added unknowingly to your monthly payment schedule.