Nov
27
2012

CPP Mis-Selling Trouble Spreads to Banks – Another PPI Claim May Be Owed You!

Posted by with 0 Comments

CPP mis-selling results in more bank PPI claims

Image source: TheTimes.co.uk

I wrote last week that credit card insurance company CPP has been tagged for mis-selling and ordered to repay millions in PPI claim funds. FSA termed CPP’s mis-selling a “serious offence” and ordered them to pay back £14.5 million to hundreds of thousands of customers it mis-sold to between 2005 and 2011. The PPI-like products CPP has been ordered to pay out on were only direct sales that they made, although they were the intermediary in many more cases that involved major banks and this could result in millions of pounds more for banks themselves!

Many high street banks, but Santander and HSBC in particular, facilitated sales of the dodgy cover by CPP to its customers. When card holders got new or replacement credit and debit cards, there was a sticker affixed with CPP’s phone number on it that asked customers to call to activate or confirm receipt of the card. When customers called in, CPP took the opportunity to sell (mis-sell actually) card protection services. It’s not surprising that Santander would take advantage of its customers this way – it’s consistently at the bottom of customer satisfaction surveys.

Santander customers may be due PPI claims for CPP

Image source: CNBC.com

The services CPP offered purported to help customers who’d had a card stolen or lost and offered £100,000 of protection against unauthorised charges. This cover was entirely unnecessary because the bank that issued the card would take care of these charges in the case of loss or theft of a card. Identity theft cover was also mis-sold according to the FSA because agents selling the product made overblown statements about the risks and consequences of ID theft to encourage sales.

The card protection cost customer £35 and the identity theft cover ran £84. For customers who purchased both, they were out £119 per year. FSA’s Tracey McDermott said, “While CPP’s products were relatively inexpensive, they were sold widely and CPP encouraged its sales agents to be overly persistent. This exposed a very large number of customers to the unacceptable risk of buying products they did not want or need.”

FSA Tracey McDermott critical off CPP sales methods

Image source: FTAdviser.com

For the cases where CPP was the direct seller of the product, they’ve been ordered to write customers and notify them they’re due a refund. But, this won’t include cases where they were the intermediary contacted via the sticker affixed to a card. FSA is still in talks with banks over this, but there’s little doubt they’ll be ordered to pay out a PPI claim to each customer hit by this mis-selling.

Between 2005-2011, more than 4.4 million card protection policies were mis-sold before FSA forced CPP to stop offering the product. You may likely have been one of these if you had a credit or debit card from Santander or HSBC – other banks may yet turn out to be involved as well. Santander has set aside some funds to cover CPP-related PPI claims. HSBC has not yet confirmed any firms for CPP related mis-selling. Barclays is rumoured to have used CPP for card activation services and that when customers bought from CPP, they assumed they were buying from the bank itself.

HSBC may owe PPI claims for CPP

Image source: BusinessWeek.com

Lloyds and Halifax didn’t ever work with CPP. Barclays and RBS have yet to respond to requests for information about their possible involvement with CPP’s dodgy mis-selling. Although the amounts are relatively small, if you were mis-sold, you should collect your redress. If you know you’re owed for another PPI claim, contact Empire Claims and let them know you were mis-sold from CPP as well or want to know if you were and they can give you valuable advice on your PPI and CPP claim!

Empire Claims is the #1 choice for recovering money you are owed for PPI products, bank and credit card charges. Their No Win No Fee philosophy means you don’t pay a penny if they don’t win your claim. If you believe you’re owed a claim from your bank, lender or other creditor contact Empire Claims to get help right away!

Leave a Reply