Barclays have made headline news recently as they have promised to pay out compensation to anyone who has made a PPI claim before April 20th this year.

As many banks stand firm with their fight Barclays have held their hands up and has calimed they will reimburse mis sold PPI customers 8% interest on top of the total value of all premiums. Barclays are the first of all the banks to offer this ‘no-quibble’ compensation and could be a prudent move saving them money in legal fees.

This statement has come about after the banking industry suffered huge losses when the High Court Challenge to the new PPI rules were lost in April. These new rules of the sale of PPI were imposed in 2010 by the Financial Ombudsman Service and the FSA (The Financial Services Authority).

This case was lost in April and many of the major banks were said to have but aside huge amounts of money in compensation including Barclays who set aside £1bn.

The chief executive of Which?, Peter Vicary-Smith,, sid: “Banks have a lot to do to re-build their reputation after over a decade of mis-selling PPI and then mishandling complaints about it.

“It’s fantastic to see Barclays stepping up in this way, acknowledging their mistakes and refunding customers what they’re owed, no questions asked. Hopefully this will have a domino effect and other banks will follow suit – the sooner the banking industry can consign the PPI mis-selling scandal to the history books, the better.”

After losing the case, The HSBC set aside £269m, RBS put away £850m and Lloyds TSB a staggering £3.2bn to cover costs of compensation but as yet look set to question each claim. It is important that you claim back your mis sold PPI as soon as possible and companies like Canary Claims can help you fight for what is rightfully yours.

Barclays Bank has said it is going to pay out compensation to every customer who has made a claim with them against mis-sold PPI (payment protection insurance) before 20th April. This decision comes after Lloyds also advised they were about to begin paying out compensation for PPI claims.

Barclays have advised that they are the first bank to start paying out claims on a no-quibble basis. The bank is to start contacting customers whose PPI claims were put on hold on or before 20th April and settle their complaint in full, plus an 8% interest added on as a gesture of good will.

Barclays have said that “Our customers have waited long enough because of the long-running judicial review, and this would allow us to clear the backlog quickly and access new cases more quickly”.

Peter Vicary-Smith, chief executive of ‘Which?’ has advised that it is fantastic to see Barclays stepping up in this way and acknowledging their mistakes and refunding their customers what they owe with no questions asked.

However, there are legal implications for trying to do this. Internal sources at the banks have stated that the clawback clauses weren’t in place during the mis selling period. Additionally, it is much more difficult to clawback bonuses that have already been paid out, so only differred bonuses can be subject to this scheme if the banks decide that it is an appropriate action to take.

However, there are legal implications for trying to do this. Internal sources at the banks have stated that the claw back clauses weren’t in place during the mis selling period. Additionally, it is much more difficult to claw back bonuses that have already been paid out, so only differed bonuses can be subject to this scheme if the banks decide that it is an appropriate action to take.
PPI policies were designed to protect borrowers in the event of illness, injury or redundancy to help them cover their repayments. During the years of 2005-2010 these policies were widely mis sold. To find out if you are eligible for a PPI claim, then check out our claim back your PPI post.

After provisioning a massive £3.2bn for compensation against mis sold PPI Claims from its customers – Lloyds Banking Group are now considering reclaiming some of this debt back by clawing back the bonuses awarded to executives.

The chairman on Lloyds, Win Bischoff advised at the annual shareholders meeting that they were examining whether the cost of PPI claims should affect the pay of those responsible. A large percentage of the shareholders at Lloyds are mounting pressure for the firm to cancel future bonus payments to its former chief Eric Daniels. Daniels stepped down in February of this year, just before the bank took the action to provision £3.2bn in funds. According to Lloyd’s annual report, they have the power to recoup unwarranted bonuses and cancel future payments if projected profits turn out to be illusory.

The Financial Services Authority (FSA) introduced claw back rules last year, but it is believed that no bank has reclaimed any bonuses since the rules were introduced.

Lloyds Banking Group surprised the rest of the UK high street banks and the British Bankers Association (BBA) after making a dramatic U-turn and ceasing any legal battles with the FSA over mis-sold PPI claims and provisioning a massive £3.2bn to cover any compensation claims from its customers who feel they have been mis-sold the payment protection insurance.

New Lloyds chief António Horta-Osório took over running the bank from former boss Eric Daniels in March and signalled a truce with the city regulator over the seven year PPI claims dispute. He advised “It is appropriate to take provision now, and move on. It is the sensible, prudent and right thing to do”.

This shock decision has put pressure on other UK banks to follow suit and withdraw their legal action. Rivals Barclays, HSBC and the Royal Bank of Scotland are due to report today on what they decide are the next step for them.

It is clear to see that the legal battle between the BBA and FSA is slipping in favour of the FSA, and this decision by Lloyds to draw a line and cost up a proactive and fair reimbursement strategy is only adding weight against the other banks to do the same.

The British Bankers’ Association (BBA) have just lost a judicial review to stop more compensation payouts of mis-sold PPI claims.

The BBA had challenged the Financial Services Authority (FSA) over new guidelines that it published last year stating that banks should contact all past customers who were sold PPI for loans and invite them to complain if they thought they had been mis-sold the loan repayment insurance. But today the high court has rejected this challenge in favour of the Financial Ombudsman Service.

The decision is likely to cost the banks and credit card companies up to £4.5bn – repaying customers who request compensation for the mis-sold PPI, including any interest earned on the premiums. Currently the BBA is reviewing the decision, and whether or not to appeal – which they have up to 21 days to do so. The BBA has advised banks are still going to put new cases of PPI complaints on hold until a decision on an appeal is reached.

The FSA have advised there have been 1.5 million complaints about PPI since 2005. They believe this decision should rule the end of poor handling of complaints by the banks, and trigger a dramatic improvement in the way people are treated in the future.

The FSCS (Financial Services Compensation Scheme) has declared that WFSL (Welcome Financial Services Limited) is in default after it admitted that it could not pay compensation claims linked to PPI (payment protection insurance) sales. This notice was added to the homepage of the Welcome Finance website, and stated the following:

“The FSCS has declared WFSL in default. This is because the firm is unable, or likely to be unable, to pay claims against it in relation to PPI. WFSL sold a substantial number of PPI policies to its customers, and a declaration of default opens the way for those customers, and any others who might have valid claims against the firm that are protected by the FSCS, to make a claim.

The FSCS will now be responsible for PPI claims against WFSL. To assist in its handling of claims, the FSCS has arranged to use WFSL’s claims handling resources. However, the FSCS will remain responsible for all decisions on claims, which will be made in accordance with FSCS rules, and will closely oversee and monitor all steps in the handling of claims. This arrangement will enable claims to be processed more quickly and efficiently.”

Only policy holders that were sold PPI on or after the 14th January 2005 are eligible to make a claim. Any customers wishing to claim back mis-sold PPI prior to this date will not be entitled to compensation. Anyone who has already submitted a claim for compensation for PPI which they think was mis-sold to them on or after the 14th January 2005 need not take any action, as their claim will be dealt with in due course.

The FSA recently appointed three more non-executive directors to the board of the Financial Ombudsman Service (FOS) as it prepares for a surge in PPI claims as the recent figure for PPI reclaims has risen in the last year by up to 40%.

Banks have recently being putting PPI (payment protection insurance) complaint claims on hold while a judicial review has being taken place to investigate the FSA legislation. The banks are often citing this as a lawful and legitimate reason not to pay out any compensation, or even take on new claims or continue with existing.

The FSA however are warning the heads of the major banks via an open letter that even though the judicial review is taking place, they still need to process and deal with any existing and new PPI compensation complaints. The FSA have advised that only a small number of complaints will be held up due to the judicial review, and that the majority of claims can still be dealt with by the banks and must be, or else enforcement action should be taken. The FSA are advising customers with complaints who are unhappy with the responses from their bank should refer their complaint to the Financial Ombudsman Service (FOS). Between 2009 and 2010, over 49,000 complaints by customers were referred to the ombudsman – of which 90% were upheld in the complainants’ favour.

If the judicial review is unsuccessful it could see the banks forced to pay out billions in compensation to people with mis-sold PPI packages.

There is nothing wrong with PPI policies as a sellable product, and often consumers may want this level of insurance when taking out a large loan or mortgage, but in recent years it has arisen that millions of people have been systematically mis-sold PPI without proper knowledge or understanding that it was being added to their committed repayments.

If someone is mis-sold payment protection insurance they are entitled to claim this money back, often reclaiming £1000’s back in compensation.

The financial ombudsman service is an independent statutory body established by parliament as a financial expert to settle individual complaints between consumers and any businesses providing financial services. It is a free service used where the consumers are unable to resolve by issues on their own.

The ombudsman service deals with a wide range of financial matters, mortgages, credit cards, and insurance including mis sold PPI (payment protection insurance) cases. As the service is completely independent and impartial, it will assess claims from both sides in the event of a complaint. When it has been decided that a consumer has in fact been treated fairly, they will explain why and close the case. If the decision is made that the business has acted unfairly, the financial ombudsman has the power to seek compensation on behalf of the complainants without it going to court.

If neither party agree on the outcome (for example a consumer trying to claim PPI compensation against a bank), the issue is then passed to the courts to decide, however – independent commentators often recommend that consumers use the ombudsman service as the outcome of a court case can often be unexpected and sometimes disappointing.