UK: FCA plans new rules for banks over PPI scandal
08 Nov 2018

The Financial Conduct Authority (FCA) has unveiled proposed plans for new rules which will require firms to reconsider claims they previously rejected regarding the premium payment protection insurance (PPI) scandal.

The regulator also published its final guidance about how it expects the PPI claims to be handled.

The consultation on the new rules, which will run for a month, requires firms to write to around 150,000 specific PPI complainants whom they previously rejected, to tell them that they can make a new complaint about non-disclosure of commission.

Banks will also need to remind them of the FCA’s 29 August 2019 deadline for complaining.

The watchdog said the proposed mailings will help consumers who have previously complained about regular premium PPI but had been rejected to consider whether they want to make a new complaint about undisclosed commission.

Jonathan Davidson, Executive Director of Supervision – Retail and Authorisations at the FCA said: “The final guidance resolves an area of uncertainty and will ensure fair and consistent outcomes for regular premium PPI complaints.”

UK banks have had to repay billions to consumers after the regulator found that PPI was often mis-sold it. The scheme was designed to help customers cover repayments of loans, for example, in cases where they were struggling to do so.

According to the FCA, as many as 64 million PPI policies have been sold in the UK, mostly between 1990 and 2010, some as far back as the 1970s.

Count reading this article to your CPD minutes, by signing up to our CPD Wallet

FREE CPD Wallet
Must Read

Understanding EU anti-money laundering law: EU 4AMLD, EU 5AMLD, EU 6AMLD

In recent years the European Union has looked to its flex its legislative muscle and come up with an array of laws aimed at cracking down on money laundering and terrorism financing. Key to its package are its various directives, which impact national laws, banking operations and various other… Read More

Banking: Curbing employee fraud and corruption with an effective KYE program

The banking system’s vulnerability to fraud, corruption and money laundering is once again a focal point of debate in the wake of recent disclosures by the Central Bank of Nigeria that major losses have been recorded by banks from armed robbery cases and other criminal activities amounting to N12bn… Read More