Whistleblower claims – “Employees at RBS being trained to lie”

According to an insider from the Royal Bank of Scotland employees at the bank are being trained to lie in order to stop customers from cancelling the Payment Protection Insurance on their credit cards. The whistleblower is apparently from the bank’s Customer Loyalty Team, and said that employees are trained to use a number of practices to stop customer from cancelling PPI on their credit cards. Read more

Tags: authority, Credit card, cancel accounts, consumer, ppi, call, ongoing investigation, rbs

Mind: Debt can exacerbate mental health problems

Consumers who suffer from mental health problems can find their health deteriorates when they get into debt and receive letters from financial institutions, the national association for mental health, Mind, has said.

A spokesperson for the organisation said that people in debt are not just receiving one letter a week, but a barrage of phone calls throughout the day from different people, which can feel “quite intense” for some people.

Recent research by Mind found that the biggest reasons for people getting into problem debt were mental health problems (66 per cent), living on a low income (66 per cent) and difficulties in managing money (58 per cent).

Mind said that it has been working with the Financial Services Authority to change the way in which lenders treat their customers who have mental health problems and fall into debt.

“We are calling on banks to keep to… a code of practice, about responding appropriately to things like missed payments and treating people who are worried and have anxiety and depression appropriately,” added the spokesperson.

Tags: Financial Services Authority, Bipolar disorder, cent, organisation, authority, financial, anxiety, Alternative medicine

CAA: Travel insurance may not cover you if the airline goes bust

Holidaymakers are advised to look for insurance that covers against insolvency as many people may find they are not protected if their holiday company goes out of business, says the Civil Aviation Authority (CAA).

David Clover, a spokesperson for the CAA, said people travelling abroad this summer should try to find an insurance policy that provides a range of protection.

Even if a policy does cover insolvency, it may only provide limited protection so customers may receive a refund for a lost flight but not for the cost of additional flights or accommodation.

According to holidayadvice.org.uk, more than 25 airlines have gone bust since 2000 and it is unlikely that customers received a refund if they booked directly with them rather than going through a tour operator.

Mr Clover advises: “You need to shop around for an insurance policy which can give you a varying range of protection; you need to look very closely at the small print.”

Tags: holiday company, range, refund, tour, caa travel insurance, Civil, authority, accommodation

Thousands are struggling with mortgages claims charity

Homeless charity Shelter has called for the government to do more to assist homeowners struggling to meet mortgage repayments after it revealed the number of calls it received had risen by 700 per cent.

The charity said that calls from concerned homeowners had leapt from 10,000 to 80,000 over the past 12 months.

Adam Sampson, the charity’s chief executive, said: “Shelter has seen a massive increase in people coming to us with mortgage problems, and with repossessions set to rise throughout this year we simply haven’t got the resources to help everyone.”

He added that the government needs to work with the Financial Services Authority to repair the “broken state safety net” to ensure that if people do face difficulty there is somewhere to turn for advice.

In its ‘Mortgage and Repossessions’ report Shelter also calls for new guidance to be supplied to judges in county courts so that a tougher line is taken against mortgage lenders who treat customers unfairly.

The recommendations from Shelter come after the FSA warned that as many as one million homeowners could face repossession as the economy slows down.

Tags: 12 months, Financial Services Authority, county, authority, United States, Mortgages

BIBA calls for investigation into price comparison websites

The British Insurance Brokers’ Association (BIBA) has called for an investigation into price comparison sites by the Financial Services Authority (FSA), saying the body’s regulations were not written with these websites in mind.

Findings from the research revealed that over half of insurance buyers do not understand the difference between each insurance policy offered by comparison websites.

A further 84 per cent admitted to being confused by insurance policy details offered while only six per cent believed the details offered were true.

Eric Galbraith, BIBA chief executive, said: “The current FSA rules were written prior to the growth in aggregator sites.”

“I believe the regulator should now look again at developing more appropriate regulations, to ensure that consumers are being afforded suitable protections,” he added.

The research also found that many comparison websites base their calculations on assumptions meaning some consumers could purchase insurance policies which are not suitable for them.

However, Hayley Parsons, managing director of insurance comparison website Gocompare.com, said a review would be unnecessary as brokers and agents are already regulated by the FSA.

Tags: insurance comparison website, appropriate regulations, Association, British Insurance Brokers, British Insurance Brokers Association, body's regulations, insurance comparison

FSA investigation leads to two arrests

An investigation into a so called boiler room operation by the Financial Services Authority has led to two arrests, according to a recent report.

The Financial Services Authority has been investigating claims of illegal share selling, which are known as boiler rooms, and after raids on a number of homes last week two men were arrested. The raids were carried out by the FSA along with police officers.

The two men arrested are thought to be involved with Universal Management Services (UMS), which is said to be a boiler room, which means a front for illegal share selling. It is thought that consumers that have fallen victim to this scam may have lost over £5 million collectively. Although these boiler rooms are usually operated from abroad, which means that the FSA cannot take action, the agency can act on those based and operated in the UK.

Reports claim that consumers were cold called in order to sell them the shares. Victims are talked into purchasing shares that are actually worthless of worth very little. The company responsible is not authorized by the FSA. The investigations started after a number of consumers complained about the pressure put on them by sales people, who then told purchasers to write cheques out to UMS.

Jonathan Phelan, head of retail enforcement at the FSA, stated: “This the first time we have taken this action and it shows that we will not hesitate to use our powers to protect consumers, including launching criminal investigations where appropriate.” As part of the investigation over £5 million worth of assets have been frozen, according to the report. The FSA also pointed out that there are at least four other companies with similar names in the UK but that they are not related to UMS.

Tom Smith
10th November 2007

Tags: services, dealer, authority, criminal, room, financial

Homeowners urged to combat subsidence

With subsidence claims having risen by 50 per cent since 2002, according to the Association of British Insurers, homeowners are being urged to take measures to reduce the risk of subsidence in their property.

“People don’t knowingly cause subsidence, but there are ways homeowners can help to reduce the risk of such damage to their home to avoid the costs, inconvenience and inevitable worry that subsidence damage brings,” said Neil Curling, senior structural claims manager for Halifax Home Insurance.

Halifax recommends that to avoid or combat subsidence homeowners should check for historical activity of mining in the area, get a survey of the property’s drainage, trim back or remove large trees near a property and get the local water authority to check the incoming mains supply for faults.

And they should definitely double check the small print in their home insurance documents, or shop around for a cheap deal if they don’t have any.

The improving weather conditions make the risk ever greater as vegetation takes up more moisture as it grows just as the heat makes moisture scarce.

This can cause some types of ground, such as clay subsoil, to shrink as it dries out, which can undermine property foundations and crack walls – one of the first signs of subsidence.

Tags: Financial services, weather conditions, measures, check, home, authority, Association, water authority

Post Office wants end to aggressive PPI tactics

The Post Office is calling for aggressive payment protection insurance (PPI) sales tactics to be stamped out.

It follows the news that credit card company Capital One has agreed to pay a fine of £175,000 following an investigation by the Financial Services Authority (FSA).

The firm was lambasted for its poor sales and administration in regards to PPI and the Post Office has welcomed the FSA’s decision to issue a fine.

However, it also calls upon the industry as a whole to improve its standards or risk losing the trust of customers.

“If we want customers to trust our industry, these aggressive sales tactics must cease to allow for a more transparent and fairer marketplace,” said Claire Oldstein, head of communications at the Post Office.

“The Post Office has long been calling for an open market for PPI sales, where providers are honest with customers that other, cheaper standalone products are available.”

Ms Oldstein also pointed out that few customers know a great deal about PPI, with many unaware that they even have it.

In addition, aggressive sales tactics are leading to many people feeling as though they have no choice but to take out a PPI policy when they get a loan or credit card, even though this is most certainly not the case.

PPI is a voluntary insurance which is designed to protect borrowers should they be unable to work and cannot afford the repayments on their loan.

Many borrowers find that it gives them peace of mind, but it is recommended that you shop around for the best deal and do not feel as though you must take the policy offered by your lender.

Tags: post office, administration, capital one, authority, credit, fsa, PPI policy, mortgage

Capital One agrees to PPI fine

credit card company Capital One has agreed to pay a fine to the Financial Services Authority (FSA) over its sale of payment protection insurance (PPI).

The firm has reached a settlement with the authority following its investigation into the whole PPI market.

Capital One says that it has been working proactively with the FSA to ensure that its sales and administration in relation to PPI is brought up to standard.

The card company admits that there were problems in the past but says that it has now rectified these and was able to reach a settlement with the FSA because of the work it had put into addressing the authority’s concerns.

“Capital One values its relationship with its four million customers,” said Sanjiv Yajnik, chief executive officer at Capital One.

“We consistently review our policies and practices and had made a number of significant improvements prior to the FSA’s investigation.

“The FSA has recognised that Capital One co-operated fully throughout the investigation,” he added.

The firm agreed to a fine of £175,000 and it follows the announcement by the Office of Fair Trading earlier this month that the PPI market will be referred to the Competition Commission for further investigation.

If you are considering taking out PPI on any money you are borrowing it is worth while shopping around for the best deal that suits your needs.

Tags: proactively, trading, ppi market, fair, commission, relation, authority, executive