by Mark Johnston
Lloyds Fail With PPI Claims.
Payment Protection Insurance (PPI) policies were meant to protect borrowers against sickness or redundancy but were often sold to customers who did not want or need them.
The scale of Payment Protection Insurance (PPI) mis-selling is now of pandemic proportions.
Back in February, Lloyds bank was fined £4.3 million for not paying victims of the Payment Protection Insurance (PPI) mis-selling scandal promptly. The Financial Services Authority (FSA) said Lloyds had broken the rules agreed on the refunds.
Lloyds Banking Group, Britain’s biggest bank, has alone set aside £6.8 billion since January 2011 to cover repaid premium and compensation and continues to make payouts.
The Financial Ombudsman Service (FOS) received more payment Protection Insurance (PPI) complaints against Lloyds than against any other bank in the final part of last year. Over a six-month period, Lloyds was responsible for 42,195I claims referred to the ombudsman, with 86 per cent of these being adjudicated in favour of the consumer.
More recent an investigation found that staff at a Lloyds Payment Protection Insurance (PPI) complaints handling centre were advised that most customers would give up if the claim was not successful first time.
A reporter was also told that some bank salesmen had faked payment protection insurance (PPI) information in agreements on loans sales. Therefore complaint handlers should treat all claim applications as though they were genuinely completed by the customer, despite knowledge that some documents may have been forged.
Other issues that came to light included the bank losing customers evidence, and failure to adhere to Data Protection Act regulations in all cases.
Lloyds Banking Group reacted to the scandal by announcing that it had conducted its own investigation into practices at the call centre and that the contract Deloitte had therefore been cancelled.
However, it suggested that some of the training given to the reporter were ‘isolated’, and were not endorsed by Lloyds.
A Deloitte spokesman declined to comment on the particulars of the case, citing client confidentiality, but stated that its role had been to process the complaints ‘in accordance with policies and procedures’.
The consumer group Which? has called for Lloyds customers who had payment protection insurance (PPI) claims rejected to fight back and resubmit them, following an investigation that found call centre staff were encouraged to delay or deny requests for compensation.
Martin Lewis, founder of website MoneySavingExpert, said “If Lloyds have turned you down, you need to fight if you feel you have been mis-sold, certainly ignore a Lloyds rejection”.
The scandal has been unveiled against the backdrop of a review of payment protection insurance (PPI) complaint handling procedures being carried out by the new industry regulator, the Financial Conduct Authority (FCA).
Citizens Advice Chief Executive Gillian Guy said “There is already widespread mistrust in banks and today’s revelation about Lloyds claims centre staff will only compound this further”.
So in conclusion it seems there is a great need for a revolution in banking which puts a greater emphasis on customer service and delivering what consumers need, not unscrupulous practices that leave people out of pocket.
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