FSA in bid to stop mis-selling

The Financial Services Authority (FSA) has said it is planning to stop companies incentivising staff to mis-sell goods and services to consumers.

FSA managing director Martin Wheatley said regulatory change will seek to demolish the culture of rewarding staff for clinching sales that are not necessarily in the interests of the consumer.

Identifying the high-profile case of payment protection insurance (PPI) as an example of bad practice, he stated: "This bonus-based approach has played a role in many scandals we have seen over the years. Incentive schemes on PPI were rotten to the core and made a bad problem worse."

Many consumers will have suffered higher levels of credit card debt than necessary because of the PPI mis-sold on them.

Those who have suffered this could be at risk of being ripped off by companies who charge a fee for chasing up PPI claims, as those acting via the FSA will can have their bids to get their money back settled without having to shell out any more cash.

By James Francis