PPI TIME-BAR THE POSITIVES & THE NEGATIVES
Early in March 2017 a preliminary announcement was made confirming that there will be a PPI cut-off date on the 29th of August 2019 for the lodgement of PPI claims. Any claims made after that date will be time barred. For many a consumer the cut-off date would be at least two months earlier as any consumer seeking information from a Bank by obtaining a Subject Access Report which should supply all the details that the Bank has on that individual can legally be delivered up to 40 working days after the receipt of the request. In reality two months.
Accordingly, for anyone who does not hold the data who wishes to make a PPI claim the cut-off date for them could well be sometime in June. It would not be unreasonable to expect that Banks will not expedite the delivery of these Subject Access Reports and anyone who claims within the two month period and receives the information post 29th August 2019 may well argue that they should be allowed to intimate due to the delay on receipt of data, but that is an argument which would be risky for the consumer to make. Accordingly, my own Firm and any Company that provides us with PPI work will require the consumer to instruct us, if they do not have data by the 1st of June 2019.
Accordingly, for most consumers who have not claimed, whom we can only presume do not hold data, the time limit is much closer.
The moderate publicity generated by the preliminary announcement provided a startling statistic from the Financial Conduct Authority who revealed that some 52,000,000-64,000,000 PPI Policies were sold to approximately 30 Million consumers between 1990 and 2010. Amazingly, it is suggested that only approximately 1 out of 5 complaints about potential mis-sold PPI have been made so far. A figure which many of us involved in the PPI Claims Industry find astonishing.
The reason we find it astonishing is that quite distinctly from the prior Endowment mis-selling scandal there has been significant publicity the vast majority of which has been made by Claims Management Companies or Solicitors like ourselves dealing in this field. Indeed, the other major source of publicity have been Organisations which have publicised the work of Claims Management Companies in particular criticising the same and suggesting that consumers should see the Banks themselves. This, in my humble opinion, may well have assisted a number of consumers but I believe it is significantly outweighed by the fact that a considerable amount of our public unfortunately are not able to cope with the paperwork involved in these claims. Accordingly, I believe that money has effectively been saved by the sellers of PPI by this publicity. I will deal further with this in another blog.
It is understood, although there are no details available at present, that a significant arrangement has been made between the Financial Conduct Authority and members of the British Banking Association or other bodies who are not members, all of who sold PPI to advertise claims from the 29th of August. There is no doubt that much of this publicity will indicate that the kindly Bank or Financial Institution will deal with the claims themselves. As these potential claims have been well known in the Financial Services Industry since 2007 it is amazing that committed Financial Institutions looking to resolve these issues would not have gone through their database by now.
It is anticipated that not only will the Banks advertise that they can deal with the mis-selling of PPI claims but will also encourage the consumer to contact them directly. In addition, various Claims Management Companies will of course generate advertising. It is reasonable to believe that 2 year period and for a year or two thereafter while various claims at the Ombudsman are still being resolved there will be a substantial increase in PPI pay-outs.
There is no doubt that the benefits or otherwise of a time-bar on the 29th of August 2019 can be argued as either being a positive or a negative. From the point of view of the Financial Institutions involving PPI it certainly, in general terms appear reasonable that there should be a time-bar set for these claims. This on the basis that the product although still sold is sold on a more restricted and sensible basis, Regulations have clearly tightened up internally in most PPI providers and the product in the whole is now sold to benefit those who should take and potentially benefit from the same. It is also not unreasonable to suggest that a time-bar will allow the members of the British Banking Association i.e. the Banks, to budget accordingly and thus enable them to stabilise their own financial position to try and ensure that the “Credit Crunch” of 2007 onwards will not be repeated in any similar form or nature in the foreseeable future.
It is also clear that there are some benefits to the consumer in that the considerable publicity that will be generated from the end of August from either the Financial Conduct Authority, British Banking Association, Financial Service providers who sold PPI, Claims Management Companies and Solicitors should encourage numerous parties who have not got around to claiming to claim (some of us may think this is quite remarkable 7 years down the line.) Those that are not sure whether they took PPI may be encouraged to take advices as to whether or not they did (in this respect I would clearly encourage the use of a Solicitor or reputable Claims Management Company to try and trace the data); or those consumers who literally do not have a clue whether they took PPI or not, but who clearly must constitute a considerable percentage of the 30 Million consumers who apparently bought the product and did not realise they have done so (again I would encourage the use of a reputable PPI Claims Company or a Solicitor). The main concern, is that whereas the Financial Conduct Authority have suggested only one in five complaints have potentially been made it appears to anyone involved in the claims industry relating to the mis-selling of PPI that even the 2 year advertising campaign by the Financial Conduct Authority with the Banks paying the supposed £42,000,000 for advertising will not extract all the legitimate claimants. It is quite clear that over the next few years consumers when conducting a “spring clean”, possibly a house move, dealing with papers after death of one of a couple may come across paperwork which shows there is a significant potential claim. It seems grossly unfair that anybody who has a claim, and who through their own unfortunate ignorance – probably the same ignorance that got them to take the product in the first place – does not claim should not be entitled to a reimbursement, which on some occasions may be significant.
As a Practising Solicitor I am of course interested in dealing with these claims. It appears to me however quite apparent that somebody whose assets have been depleted significantly due to mis-selling of PPI cannot when they eventually discover they have a claim make the same.
There has been a suggestion of a Judicial Review taking place in respect of the Financial Conduct’s handling. However, I would not anticipate that will change what has now been decided.
Over the years, while fully respecting what “WHICH” and Martin Lewis of “Money Saving Expert” have been saying about PPI claims, I have always disagreed with their emphasis of the consumer carrying out the claim themselves. There are many, many people who can of course carry out the claims themselves. Indeed, I suspect that the vast majority of people reading this article are well able to do so. However, other than many businessmen, businesswomen, housewives and citizens from all walks of life who would much prefer this to be dealt with by an independent representative such as a Solicitor as they are too busy in their day to day lives, it is absolutely clear that a significant percentage of the population do not trust Banks to carry out these reviews correctly and more importantly do not have the ability to complete Questionnaires, be put off by questions in Questionnaires by being directed in the direction of the Banks, who are obviously not too anxious to have a consumer complete a Questionnaire correctly as claims that do not progress save the shareholders’ of Banks money. It is quite clear in my opinion that there is a significant need for reputable Claims Management Companies and Solicitors.
Indeed, Martin Lewis of “Money Savings Expert” and WHICH are clearly against this 2 years’ timetable. It is interesting to note that in their responses to the preliminary notice of the two year limit Martin Lewis has indicated “until we can trust Banks to deal with complaints fairly in the first instance, this move to protect the balance sheets should not happen. It is putting the protection of the Financial Industry ahead of the consumer. Many Banks make it outrageously hard for people to find out if they ever had PPI”. I have no disagreement whatsoever with what Martin Lewis says. It does appear to me that what he says shows that many consumers have been right for the last 10 years. They cannot trust Banks; they cannot trust the people that mis-sold a product to deal with a claim fairly. Accordingly, they have gone into the hands of reputable Claims Management Companies, Solicitors and of course unfortunately some not so reputable Claims Management Companies.
I similarly believe that the comments from WHICH suggest that the Banks have not been working hard enough to resolve PPI claims fairly. Accordingly, this compounds my argument.
If you have the time, have the desire and can clearly comprehend paperwork, complete the same and keep an eye on it, you are fully entitled and of course it is your right to deal with a claim yourself.