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FSA: Lloyds PPI redress system fell below standard

The industry let customers down badly in relation to the sale of PPI. The significant volume of complaints is a product of LBG’s own failings and the least customers can now expect is that redress, when it is due, will be paid promptly.

In short, LBG’s PPI redress payment systems fell well below the standard the FSA expects, and the size of this fine reflects how seriously we view these breaches. All regulated firms must treat those who complain fairly and that includes paying redress promptly when it is due.

– Tracey McDermott, the FSA’s director of enforcement and financial crime

Lloyds fined over late PPI compensation payments

Lloyds Banking Group was fined £4.3 million by the City watchdog today after up to 140,000 customers had their payment protection insurance compensation payments delayed.

A general view of the Lloyds Banking group Building. Credit: Press Association

The customers were not paid redress within 28 days of receiving a decision letter and almost 9,000 had to wait more than six months for their compensation, the Financial Services Authority said.

The failings relate to Lloyds TSB Bank, Lloyds TSB Scotland and Bank of Scotland, leading to a total fine of £4.3 million.


FSCS: 'Claims companies take a sizeable chunk'

In 2012, double the number of people made claims from failed PPI firms, compared to the previous year, research has found.

Claims management companies take a sizeable chunk of any payout. Consumers who make a claim directly to FSCS keep every penny of their compensation.

Some people may prefer to use a claims management company, but it is important that they understand the charges from the outset and are happy to pay them.

– Mark Neale, chief executive of FSCS

Nearly 20,000 submitted PPI claims from failed firms

Figures released today have shown that the number of people making claims for mis-sold payment protection insurance (PPI) from firms which have gone bust, has almost doubled year-on-year.

Nearly 20,000 people submitted claims in 2012, compared to more than 10,000 in the previous year Credit: Owen Humphreys/PA Wire

According to the Financial Services Compensation Scheme (FSCS), nearly 20,000 people submitted claims in 2012, compared to more than 10,000 in the previous year.

The findings come after the Financial Ombudsman Service (FOS), reported that it handled 11,000 complaints a week about PPI mis-selling, in the last three months of 2012.

The service resolves disputes between people and financial services firms,


  1. Laura Kuenssberg

FSA considers banks' time limit request for PPI claims

The Financial Services Authority has said they will consider the request from banks to place a time limit on Payment Protection Insurance (PPI) claims:

Our key priority is to ensure consumers are protected, so the FSA Board would need to be convinced that any proposals would be in the interests of consumers.

We have had initial discussions and are prepared to consider the merits of this and other options.

A key consideration will be the potential to get compensation to more consumers, more quickly.

However, no changes to existing FSA, or future Financial Conduct Authority (FCA), rules would take place without a full public consultation.


They do not sound convinced!

PPI scandal costs 'Big Four' lenders over £10 billion

The Royal Bank of Scotland's announcement that mis-sold payment protection insurance (PPI) claims have cost the taxpayer-backed bank £1.7 billion has taken the total bill for Britain's "Big Four" lenders to more than £10 billion.

The PPI scandal is one of the worst to hit the UK's big four lenders Credit: Gareth Fuller/PA Wire

Yesterday, Lloyds Banking Group set aside another £1 billion to cover PPI claims, bringing the total to £5.3 billion, while Barclays announced an additional £700 million, giving it a total of £2 billion.

HSBC is forecast to post a more modest provision next week.

Hester: RBS working 'very hard to stand still'

Stephen Hester, RBS Group chief executive, said the Royal Bank of Scotland is "having to work very hard to stand still", adding, "We aspire to achieve much more".

Mr Hester said in the bank's interim management statement:

The extraordinary challenges which RBS faced following the financial crisis are being worked through successfully.

Beneath these headlines our people have been working hard at supporting our customers and rebuilding the capabilities of the core business, the future RBS that is emerging from our work.

In doing this we face the same strong economic and regulatory challenges as other banks and are having to work very hard to stand still in the face of these challenges.

We aspire to achieve much more; in short, to be running a really good RBS.

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