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Category: Latest PPI News


Banks Criticized for Offering Bonuses After PPI Mis-Sellings

Filed Under: Latest PPI News by Kalen — Leave a comment
December 16, 2011

A few days ago, it was revealed that Lloyds Banking Group can take back part of the one and a half million pound bonus offered to its CEO. As a state-backed bank, Lloyds has the flexibility to do this. However, it has also created a controversy with other banks and the bonuses they have offered to their executives.

Critics are placing a lot of pressure on other banks to consider revoking the bonuses issued to their executives as well. Following the scandals many banks have participated in regarding the payment protection insurance mis-sellings, many people feel sickened by the idea that banking executives should take bonuses.

Lloyds may be the crack in the dam that will cause other banks to cave in on the pressure. Considering the British government owns nearly half of Lloyds Banking Group, the bonus to CEO Eric Daniels is more concerning to them. The bank posted an end of the year loss after it was required to set aside 3.2 billion pounds to compensate customers who had been missold PPI packages. British taxpayers are particularly upset that they are being asked to pay a bonus to the CEO of a bank that has not only engaged in controversial PPI sellings, but has also failed to post a profit.

This may be the first time a major lender has considered withholding compensation to an executive. However, this is a serious case and customer tensions are high. Anthony Watson is coordinating the remuneration committee. Watson realizes the need to conduct a thorough investigation and consider all aspects of a decision.

Daniels’s bonus is intended to be paid out through shares of stock. According to FSA rules, these shares will not be available to him for another 15 months. Therefore, any part of the bonus that has not yet been paid out may be revoked at any time. After considering all implications and ensuring any decision is in lines with the policies of the FSA, the board of the remuneration commission will announce a decision.

Of course, a number of critics argue that it was inappropriate to pay Daniels a bonus at all. The previous Treasury spokesman, Lord Oakeshott, has said that bonuses paid to other executives should be reevaluated and possibly revoked as well. Oakeshott said that it is appalling that any chief executive “responsible for this gross consumer mis-selling scandal should have been paid a bonus.”

Lloyd’s chairman, Sir Win Bischoff, was the first to bring up the possibility of revoking the bonuses paid to Daniels and the other Lloyd executives. The remuneration board has not announced a date of a possible decision, but one is anticipated in the near future.

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Customers Mis-sold PPI Insurance Will Pay Taxes on Their Compensation

Filed Under: Latest PPI News by Kalen — Leave a comment
December 15, 2011

Millions of customers have won settlements against the banks and other financial institutions that have mis-sold them payment protection insurance (PPI) packages. However, these customers are in for a rude awakening come tax season. On December 4, it was revealed that these customers will have to pay significant taxes on their compensation.

Collectively, these customers will be forced to pay the treasury 350 million pounds. The average customer will receive 1,240 pounds for their settlement. This will incur a tax of 48 pounds, but many customers will be taxed much higher for their compensation. According to sources, some customers will be stuck paying thousands of pounds in compensation on their earnings.

Customers who were mis-sold PPI packages can claim up to six years worth of payments on the policies, along with 8 percent interest. Under the law, the interest earned on the repayment can be taxed. Some of these customers have paid up 16,000 pounds for payments and interest. The Treasury’s 20% tax rate will obligate them to pay over 1,500 pounds in taxes.

Customer advocates feel these policies are extremely unfair and insist the banks pay the taxes. Even though customers feel they have won a victory over the banks, these groups insist that is not the case. These banks have taken billions of dollars from customers through mis-sold payment protection insurance claims. During that time, they lent that money out to customers, sometimes at rates of nearly 30 percent. Therefore, the banks are still making substantial profits after repaying customers, even with the 8 percent interest.

According to one customer advocate, these taxes just add salt on the wound of customers who have already been victimized by these financial institutions.

Fortunately, there may be a few other solutions. According to a representative for HM Revenue and Customs, customers do not generally need to pay taxes on PPI repayments. However, interest is taxable. The spokesman said this concept makes sense. If customers never paid the banks for a payment protection insurance policy and invested their money in an interest bearing account instead, they would be taxed on that interest.

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Merry Christmas From All Of Us At PPIRefundsUK.co.uk

Filed Under: Latest PPI News by John Gregory — Leave a comment
December 14, 2011

It’s Christmas! And to celebrate we’ve put a tree up and spent the staff party budget on two inflatable festive personalities. In fact, we’re so pleased with the Christmas decorations; we took a picture to show you…

ppi claims compensation

Christmas in the PPIRefundsUK office!

Looks good, right? And believe it or not, that Robin isn’t even real! It’s actually a beautiful card sent into us by one of our customers, Mona. Mona made a claim through our PPI refund service and our expert claim adviser Alex helped her get a refund right before Christmas!

Inside the card was a lovely note to Alex, reading: “Thank you for your help and kindness to me in helping me with the PPI refunds claim.” Alex was kind enough to let us pop a few pictures up of the card and we send a whole-hearted thank you and Merry Christmas to Mona and her family!

mis sold ppi claims

We just love helping wonderful people get their money back

 

If you’re thinking about starting a PPI claim, we’ll be accepting new cases up until this Friday 16th December so either call us today on 0800 840 72 92 or fill out the form on the home page. And whether you celebrate Christmas or not, may you have a wonderful festive season and a happy new year from everyone at PPIRefundsUK.co.uk.

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So, what does one Trillion dollars (£650 bn) look like?

Filed Under: Latest PPI News by John Gregory — Leave a comment
December 8, 2011

Do you remember what you were doing on Wednesday 8th October 2008 at 11am? Probably not, but you may recall what was going on at Whitehall. At 11.04am on the 8th October 2008 the UK Government picked up a pen and wrote out £650 billion in cheques to keep the country afloat.

trillion dollar bank bail out

There'd be a lot less to talk about if a trillion looked like this

£650 billion. That’s one trillion dollars, or in numbers: $1,000,000,000,000. It’s a ridiculous amount of money and hard to imagine what it would look like, but thankfully someone’s been awesome and done a series of graphics.

Take a look at the link below, it’s a brilliant illustration of what $1 trillion dollars looks like compared to smaller amounts and shows clearly just how much of a hit our country’s economy took to keep reckless, careless, morally vacuous banking establishments afloat… what a bank bail out looks like

Once you’ve had a butchers at that, come back here and we’ll show you what the current outstanding US national debt looks like. It’s more impressive (scary) than the UK amount, plus we haven’t quite finished that visual yet! Eye-popping US debt visual.

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Mis sold PPI, Mis sold Investment Bonds, Unfair Charges – Is Banking Self Regulation Working?

Filed Under: Latest PPI News by John Gregory — Leave a comment
December 5, 2011

Yes! The system works. No really, banks regulating themselves really works and we’ve more proof of it this week as yet another fine was issued, this time to one of our trusted high street financial institutions. HSBC has been fined £10.5m by the Financial Services Authority for mis-selling investment bonds to elderly people in care.

It fills you with pride doesn’t it, the UK banking system allowing companies to mis sell financial products to elderly people in care, even worse; the products that were mis sold were supposed to fund care costs. A total of 2,485 customers of NHFA, a HSBC subsidiary, were advised to invest, with 87% being sold an unsuitable product.

mis sold ppi claims

The subsidiary has been closed down as "HSBC no longer feels is consistent with its main banking business"

The investments were sold between 2005 and 2010, to people with an average age of 83 who were already in care, or entering long-term care, each customer invested an average of £115,000 intended to fund future care costs.

“Contrary to everything we stand for”

Speaking about the mis selling, Brian Robertson, chief executive of HSBC Bank, said: “I fully accept that NHFA failed to give suitable financial advice to some of their customers”

He added: “This should not have happened and I am profoundly sorry that it did. We have high values here at HSBC and this runs contrary to everything that we stand for. That is why when we suspected something was not right at NHFA, we took action.”

Lets hope other banks are as honest

The most worrying aspect of this case, aside from a financial adviser taking over £100,000 each off around 2000 elderly people, all of whom need the money to pay for their care, is that if HSBC hadn’t fessed up to the mis selling it may never have been punished. HSBC said it identified problems at NHFA, closed the subsidiary to new business in July, and alerted the FSA. Let’s hope other Banks are as honest after they are so completely dishonest, otherwise they’re all dishonest and that is simply unthinkable.

HSBC will pay £29.3m compensation to the families of victims and will be contacting those affected.

Other Recent Fines (November)

- £6.3m: Private bank Coutts fined for describing AIG bonds as low-risk

- £5.95m: UK arm of Credit Suisse fined for advice failures when selling complex financial products

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The Problem With A Jewel Encrusted Car (Plus 10 Things To Look For When Choosing A PPI Claims Company)

Filed Under: Latest PPI News by John Gregory — Leave a comment
November 28, 2011

What’s that saying about rubbish stuff made to look good, ‘Mutton dressed as lamb’ or how about ‘The Shepherd, even when he becomes a Gentleman, still smells of lamb’. Oh and then there’s ‘The cheapest car in the world, even when encrusted in jewels, still has wind up windows’.

OK, the last one was one of ours but it’s completely true – Indian car manufacturer have made a jewel-encrusted version of their Tata Nano, the cheapest new production car in the world. Those crazy Indians have caked the Nano in 80kg of gold, 15kg of silver and heaps gemstones, worth over £3 million.

ppi claims companies

Tata's cheap Nano has a seriously pimped exterior, but never judge a book by it's cover

Obviously it’s a publicity stunt, cheapest car becomes the most expensive and all that, and it’s worked – clearly. But that doesn’t change the fact that once you get in it you’re still surrounded by an interior distinctly lacking any kind of ‘bling’.

Which takes me onto the moral of, and reason for, this blog (you know I can’t get away with writing about this without a link to PPI claims somehow, so here goes…), there are many PPI claims companies out there offering a cheap %fee and a full refund package but once you sign up, the jewels are taken off and you’re left with a standard, very basic and sometimes over-priced service.

We’ve seen this in the news recently with companies charging too much up front, plus the Watchdog investigation into PPI companies that were found to be mis selling PPI claim services. So, how do you know which company will genuinely give you a great service, with a full PPI refund and a fair fee? Use these 10 points and you’ll stand a good chance of choosing one…

The 10 best ways to ‘see through the jewels’ when choosing your PPI claims company:

1. Check their website for an MOJ Authorisation number, they must have one by law, if you can’t see one – click away

2. Make sure they have a freephone number, it should be completely free to enquire about a claim

3. Check that they don’t charge an upfront free, you should be able to enquire about and start a claim for free

4. Confirm that they work on a No Win No Fee basis, this way there’s no fee to pay if your case is unsuccessful

5. Look for testimonials on their website

6. Look for lots of free information on their website as well, if they’re the experts they say they are, then they should provide you with lots of advice and FAQ’s

7. The company should clearly display their fee structure, for example ours is: No fee up front, 25% + VAT if successful, No Win, No Fee

8. Ideally they should provide you with a dedicated case handler, this isn’t essential but it helps you get answers quicker when you call in

9. They should also include unfair charges on your loan or credit card in the claim as well as mis sold PPI, we do

10.  Finally, and importantly – they should never push you into anything and should be happy for you to take as long as you like to think about starting a claim

So there it is: why a cheap car is like a poor PPI claims service and 10 ways to make sure you get the best claims advice and legals without paying over the odds.

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UK Banks Hand Out Cash And Create Jobs, All Thanks To Mis-sold PPI

Filed Under: Latest PPI News by John Gregory — Leave a comment
November 22, 2011

Need some cash or a job? Worry not – the banks have got it covered. There was us thinking that they mis sold PPI to make billions of profit from useless and expensive insurance cover that would never pay out if you needed it, but it turns out they were just helping the UK get back on it’s feet.

This week saw the 300,000th PPI complaint land on the Financial Ombudsman’s mat and with only 300 people dedicated to handling them, the regulator is on a recruitment drive. The thing is: if the banks didn’t reject so many claims then the FoS wouldn’t have to then investigate them and employ more people to uphold 9 out of every 10 cases referred to it.

Speaking in the latest FoS newsletter about the number of complaints received, Natalie Ceeney, Chief Financial Ombudsman, said: “These numbers are pretty unsettling for us.”

She goes on to say “If all this means we’ll need significantly more resource and capacity to handle ever-higher numbers of PPI complaints, then we need – now – to build this into the plan and budget we’ll be consulting on in the new year.”

And now for a high-end graph containing some PPI refund stats:

mis sold PPI facts graph

Over 6000 jobs could be created by mis sold PPI claims, as this extremely technical bar chart illustrates.

With only 300 members of staff working exclusively on PPI claims recruitment is essential to prevent a backlog of claims developing. Add these positions to the estimated 6,000 created by the banks to handle PPI complaints and the mis selling of PPI may well be able to claim one positive impact.

Of the 532,000 claims made in the first half of this financial year; 80% were referred to the Financial Ombudsman Service by claims management companies, revealing that the majority of people prefer to use a PPI claims solicitor rather than handle the claim themself.

With £557m being paid out to victims of mis sold PPI in the first six months of the year, 2011 is set to be a record PPI payout year, topping £1 billion and significantly contributed to by August, which saw £230m paid out in compensation alone.

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Taxman Takes Cut Of PPI Claims Payouts (but here’s why you won’t lose out)

Filed Under: Latest PPI News by John Gregory — Leave a comment
November 15, 2011

Yes, I’m afraid the rumors are correct – the taxman can take a cut of your PPI claim payout, but you would’ve paid the same amount to him even if you’d never had a PPI policy in the first place. Here’s why:

Take our PPI claims service – when you make a PPI claim through our team, we’ll request a full refund of all your unfair payments and we’ll also request interest at 8% on the amount you are refunded. We request the interest as well because had you not spent the money on the unfair PPI policy, you could’ve earned 8% interest on it in a savings account.

It’s the interest repayment that is the issue, because although your PPI payments refund is tax free, the interest repayment amount is taxable – just like all savings.

taxman takes cut of ppi claims

Tim Henman dressed as a taxman, right?

How do I pay the interest?

The Interest should’ve been taxed at source by the lender before being refunded to you but not all banks have taken care of this. HSBC, Barclays, Lloyds and the Co-operative Bank have said that they will not be deducting the tax at source, while RBS/Natwest said it will. All loan companies are required to deduct the tax.

Speaking to BBC Radio 4′s Money Box programme, a spokesman for HM Revenue & Customs said: “No tax is generally due on the repayment element of compensation paid to those mis sold PPI. However, the additional interest is taxable – in line with other compensation claims.”

When asked what refunded customers should do to find out where they stand, the spokesman commented: “Customers should check with their PPI provider as to whether tax has been deducted at source.”

Extra Hundred Million In Tax

So, the advice is to ring your bank, lender or PPI provider to confirm whether or not you owe the Taxman anything. As usual the banks have already tried to shirk their responsibilities by writing to their customers explaining that they need to contact HMRC themselves to discuss what tax is due on the interest payments.

If all £6 billion worth of refunds are handed out, the government could expect to see a few hundred million pounds extra in tax revenue.

 

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Mis Sold PPI Claims Hit Lloyds Profits

Filed Under: Latest PPI News by admin — Leave a comment
November 8, 2011

The PPI Karma Gods have struck again, this time leaving Lloyds with a £3.9bn loss for the first nine months of 2011, pushing profits down by 21%. The bank, which is 41% owned by the tax-payer, also had to scrap recovery targets in light of the poor figures.

mis sold ppi claims lloyds

The bulk of the £3.9bn is a whopping £3.2bn put aside by the bank to pay back customers making mis sold PPI claims, but don’t feel too bad for them, RBS swung a £1.6bn loss around to a £2bn pre-tax profit in 12 months.

To be fair to Lloyds, it is meeting lending targets to small and medium-sized firms (the foundations of a healthy economy) and it has reduced exposure to potentially toxic debts in Italy, Spain, Portugal and the Republic of Ireland. But then you’d expect both of these things from any responsible lender that was pulled back from the brink by it’s customers and other bank’s customers. Lloyds’ shares were up 6.6% this morning.

To read more about Lloyds, checkout the Mail or BBC

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Mis sold PPI Claims Companies On Watchdog

Filed Under: Latest PPI News by admin — Leave a comment
September 16, 2011

Someone’s been a little naughty haven’t they – did you see Watchdog on BBC 1 last night? It had a piece about PPI claims handling companies and how they’ve been less than honest with their customers. Many of the big PPI claim companies that advertise on TV were caught on secret recordings doing the following:

- Promising faster payouts than if you did it yourself
- Promising higher payouts than you could get
- Charging upfront fees and not refunding them if the claim resulted in a ‘no win’
- Saying you only have a 10% chance of winning if you claimed yourself; and get this
- One company even said that you need a Ministry of Justice (MoJ) license to make a claim! We need the license, not you!

watchdog ppi claims companies

Watchdog's Riz Lateef explains which companies they dealt with

The Watchdog team called 12 companies in total and six of them broke MoJ rules on two out of three calls. Speaking on the programme about the companies featured, Tony Boorman from the Financial Ombudsman Service said: “It does make me a little bit angry that these customers, many of whom have already suffered from mis selling of Payment Protection Insurance, are now being mis sold claims management services”.

We completely agree and as much as we’d love to handle your claim, the great thing about the UK is: you have the choice to take on a bank on your own. If you didn’t see the episode, go here and scroll to about 1.50 in, the piece is about 8 minutes long.

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