Liverpool Victoria was fined £840,000 by the Financial Services Authority (FSA) for breaching regulations when selling almost 15,000 payment protection insurance (PPI) policies between 2005 and 2007. The financial company mis-sold PPI to its customers who took out personal loans – adding to the cost of the loan even if the customer did not request it. If spotted by the customer and asked to be removed the company was found to use hard-sell tactics to try to dissuade them from cancelling it.
The FSA advised that 14,500 customers were affected with the mis-selling of PPI, costing on average £1,600 per policy which earned Liverpool Victoria and its underwriters more than £23m. As well as being fined £840,000 (which would have been up to £1.2m if they had not co-operated with the FSA) they were also ordered to compensate all customers for any interest earned from the PPI premiums, costing them possible millions.
Liverpool Victoria apologised to its customers for any errors in their PPI sales processes and stopped all sales of PPI with loans until it reviewed its internal processes