PPI Claims And New Developments In The Banking Industry
In the past we grew up in an area and used the local bank, we developed a relationship, they knew us and understood our financial situations and work with us to provide sound financial advise to us. They gave us solid advise and preached savings and risk free investments. over the past decade how things have changed, banks seemed to have become engaged in risky trading and as we have been shown in fraudulent activities to boost their profits at all our expense. One example is the PPI scandal that is rocking the banking industry now
As more data comes to light, it seems clear that PPI, like other financial products, was deceptively and improperly marketed and sold to consumers. As the PPI scandal continues to make its presence felt in financial headlines, consumers need to be aware of new developments on the issue.
What is the root cause of the PPI controversy? According to consumer advocates, Payment Protection Insurance claims have an extremely high rate of denial, as opposed to other forms of insurance. These rates of denial are high enough to have created considerable controversy, not to mention legal actions. Commentators have pointed out that PPI has been sold to countless consumers who are in fact ineligible to receive PPI coverage, as they learn in time.
Remarkably, research shown that up to 40% of PPI holders were unaware that they had purchased the policy. Third party loan agents have an especially spotty record when it comes to mis-selling PPI. Many of these third parties were caught misleading loan applicants in one of two ways. Firstly, by saying that a loan was “protected” without defining PPI and it’s costs. Secondly, by incorrectly claiming that purchasing PPI was “mandatory.”
In the United Kingdom, major banks like Barclays have been caught up in the controversy surrounding Payment Protection Insurance. Critics have pointed to PPI as an integral part of unwise risk-taking that characterized banks and lending institutions in the past few years. These speculative bank practices have resulted in tremendous damage to unwary consumers and our global economy in general.
Barclays was recently on the losing end of a major lawsuit on behalf of bank customers. Industry expert Micheal Pilgrim reports that, expecting a court victory for Barclays, major banks had simply stopped addressing consumer PPI complaints well before the resolution on that case.
After the unfavourable ruling, banks now have to deal with an extensive backlog of claimants, as well as a flood of new claimants. It’s certainly good news that bank customers are receiving some attention for their legitimate woes. Nevertheless, PPI claimants should considering hiring professional help in navigating the legal maze of PPI claims.
It’s certainly hoped that consumers will receive due payment for PPI (Payment protection Insurance) related malfeasance. On a broader level, however, we hope that banks will learn to take a safer, more prudent approach in the future.