Claim Hero said this is the ideal time to make a claim for PPI mis-selling – contact our team of Heroes on 0808 159 6034 or through our claim page to see how much you could receive.

Claim Hero said this is the ideal time to make a claim for PPI mis-selling – contact our team of Heroes on 0808 159 6034 or through our claim page to see how much you could receive.

The hit comes after the High Court decided that new rules on the mis-selling of PPI could be applied retrospectively and the British Bankers’ Association pulled an appeal against the decision.

Santander UK is the latest bank to reveal its PPI charge after Lloyds Banking Group made a provision of £3.2 billion, Royal Bank of Scotland set aside £850 million, Barclays £1 billion and HSBC earmarked 440 million US dollars (£270 million).

In Claim Hero’s opinion Leenders was deluded to have said: “This is a classic area where we felt we had complied entirely with what was required. That is not just based on our internal risk, compliance and legal assessments, but the external advice we received as well. Those risk and compliance departments have been involved in conversations with the regulator since 2001 to make sure the paperwork and documentation was correct. To then say 10 years down the track ‘this is how it should have been done and you should have known’, puts the industry in a very invidious position.”

The Independent Commission on Banking member and former Ofgas director general Clare Spottiswoode agrees with Claim Hero in saying: “It is absolutely outrageous in my view that the banking industry can defend introducing the PPI product on the basis they did all the paperwork and complied with all the regulations.” She added although large fines have been levied on banks as a result of PPI misselling, the fines do not equate to the large profits banks made by selling PPI.

Under FSA rules PPI complaints have to be responded to within eight weeks. The extension agrees a timeframe for the firms to deal with the claims that have been put on hold and also agrees additional time for the firms to deal with PPI complaints received since the end of their involvement in the judicial review:
PPI complaints still with the firm but put on hold during the judicial review will receive a decision by the end of August;
PPI complaints received after the conclusion of judicial review but on or before the 31 August will be responded to within 16 weeks; and
PPI complaints received on or after 1 September and before 31 December 2011 will be responded to within 12 weeks.

Strict conditions have been imposed on the temporary time extensions; the firms with the temporary time extension will have to:
keep PPI complainants and their customers fully informed; and
provide the FSA with regular reports on compliance.

The FSA expects all PPI complaints handling to return to the requisite eight-week standard by 1 January 2012 at the latest. This arrangement only applies to the three named firms. All other PPI complaints are unaffected.

Claim Hero will be working tirelessly to ensure the Banks adhere to these timescales. Margaret Cole, the FSA’s interim managing director of the Conduct Business Unit, said: “We want to see all PPI claims for compensation dealt with swiftly and appropriately. However some firms are facing a huge backlog and now a surge of new complaints which has created a bottleneck. It is not in the interests of consumers to receive further poor handling of their complaints as a result. This temporary extension means that these firms can process these complaints properly and fairly. We will be monitoring their progress carefully to ensure the new deadlines are met, that complaints are dealt with as promptly as possible and the backlog is cleared as a matter of urgency.”

A number of cynical Banks decided to put some or all PPI complaints on hold when the British Bankers’ Association launched a judicial review of the FSA’s new PPI complaints handling measures. The FSA and the Financial Ombudsman Service won the case and the BBA decided not to appeal on 9 May 2011.

The British Bankers’ Association, which fought this cynical case, said it would not appeal after losing a court challenge against new rules on mis-selling. Barclays said it had set aside £1bn to pay compensation, and HSBC £269m, while RBS added £850m to the £200m it had already paid or provided for. Last week, Lloyds Banking Group made a £3.2bn provision for possible claims.

Peter Vicary-Smith of the consumers’ association Which? agrees with Claim Hero when he said the banks had now seen sense. “It was a colossal error of judgment by the BBA to have brought this case in the first place, which has even further diminished the banking industry’s reputation in the eyes of consumers,” he said. “PPI was mis-sold and complaints about it mishandled on an industrial scale for well over a decade.

In a statement the BBA said: “In the interest of providing certainty for their customers, the banks and the British Bankers’ Association have decided that they do not intend to appeal.”

Barclays’ chief executive Bob Diamond said the bank would now begin the process of compensating customers as the big banks should have been more mindful of paying due regard to the interests of customers and treating them fairly. Claim Hero agrees with him when he said “We don’t always get things right:” and hopes he follows through when he said “When we get them wrong, we apologise and put them right.”

Last week, the High Court ruled that banks had wrongfully sold PPI to millions and that they are now obliged to refund all affected customers. Well done Lloyds, the biggest seller of PPI, who said this week it would repay all customers missold such policies, other banks may continue to fight claims. Lloyds Banking Group has said it would set aside £3.2bn to repay money wrongfully charged to its PPI customers.

The BBC is reported as understanding that the banks meeting, including HSBC, RBS and Barclays, are disappointed with Lloyds’ decision to break ranks and not appeal. In typical fashion none of the major other banks have agreed to make any refunds in this area. However, Claim Hero is pleased that the banks must agree their course before Tuesday, which is the deadline for any legal appeals.

The final figure for PPI compensation could reach up to £6.5bn with Barclays and RBS potentially liable, if they don’t appeal, for roughly £1bn each. The cynical British Bankers Association has already said that its members are very concerned at the “dangerous precedent” which would be set if the banks were forced to refund all PPI customers retrospectively.