PPI continues to generate fresh complaints

Fresh complaints about the mis-selling of payment protection insurance (PPI) are continuing to flood into the Financial Ombudsman Service (FOS).

Fresh complaints about the mis-selling of payment protection insurance (PPI) are continuing to flood into the Financial Ombudsman Service (FOS).

In the first half of this year, the FOS stated it received 135,170 new complaints, which represents an increase of 27 per cent on the previous six-month period.

Of the new complaints, it was found that 63 per cent (85,562) were concerning PPI.

During the opening six months of 2012 the FOS upheld nearly all PPI complaints against some businesses but mainly big banks and credit card firms.

The FOS deals with complaints if and when customers and financial services are unable to come to an agreement on a settlement.

Earlier this summer, Lloyds Banking Group announced it had increased its provision to pay for the mis-selling of PPIs by a further £700 million to take the total to £4.27 billion.

Since then the Financial Services Authority has said it is planning to prevent companies from incentivising staff to mis-sell goods and services to unwitting consumers.

Its managing director Martin Wheatley added that regulatory change will seek to destroy the culture of rewarding staff for clinching sales that are not in the interests of the consumer.

Many people will have suffered higher levels of credit card debt than necessary as a result of PPI being mis-sold to them.

Chief executive and chief ombudsman Natalie Ceeney said the volume of PPI complaints doubled in the first half of the year and this has continued to increase since with up to 1,500 new cases arriving each day.

"We've also seen an increasing shift towards consumers doing it themselves rather than using a claims manager – with up to half of all new complaints now coming directly from consumers without paid-for representation, compared to less than 20 per cent a year ago," the expert was quoted as saying.

By James Francis

Tell others:

shortlink