Years after the controversial financial instruments have ceased being issued, PPI complaints are still flooding into the Financial Ombudsman Service each and every day, and current and former Barclays customers are leading the charge. In fact, the latest report states that the large financial institution receives more than 1,500 complaints every single day.
Barclays PPI Complaints
A Sea of PPIComplaints
Barclays has the unfortunate distinction of being named by the FOS as the single most complained about bank in all of Britain. Lloyds Banking Group may have received more overall complaints, but they stemmed from numerous banks under the entity’s umbrella.
When Antony Jenkins inherited the role of Barclays CEO in August of last year, he made a professional pledge to rebuild Barclays’ diminishing reputation. Between the LIBOR rate rigging humiliation and the dubious distinction of being the bank with the most PPI complaints, most believed Jenkins had bitten off more than he could chew. Now, this seems more obvious than ever before.
Handling of PPI Grievances
Right in line with the spirit of the bank’s makeover, Barclays has announced it plans to release its PPI complaint statistics every three months, rather than the six months required by the FCA. Barclays claims it will help them engage with customers more frequently, but it seems more like a valiant attempt at salvaging their reputation and client base. However, they have also stated that they are developing numerous action plans in order to address grievances.
A recent statement released by Barclays tries to place the blame for the PPI scandal on a previous administration and chalk up the issue as a problem of the past. The bank remains adamant in its stance that the flood of PPI claims is not indicative of its current performance.
Officials at Barclays also claim that they are admitting their wrongdoings more so now than in their past. The figures seem to back this up, because the bank upheld 68 percent of PPI complaints in the first half of 2013, which was up three percent from the second half of 2012.
The confidence regarding the future of Barclays expressed in its latest statement indicate the bank’s understanding that its reputation will be tarnished by past misdemeanors, such as the PPI scandal that has already cost the bank millions and will cost it much more money before it is resolved.
In an effort to finally put an end to PPI complaints, Barclays increased its compensation provision last month by an additional £1.3 billion, raising the total compensation provision to over £4 billion. The bank estimates that it has already paid out more than £2.3 billion to successful PPI claimants, and management hopes the provision increase will finally put an end to the ongoing mis-selling saga.
Staggering PPI Losses
1,500 complaints a day equals a staggering 10,500 per week. With an average payout of approximately £2,500 for each successful PPI claim, if Barclays continues to uphold its judgments at its current rate, the bank will be paying out an unfathomable £17.8 million per week, which would equal an even more unbelievable £928 million during the course of this year.
However staggering these figures may be, they become even more inflated when one considers the added cost the bank accrues for each successful complaint that passes to the FOS. Barclays may be touting an improved percentage of PPI complaint approvals, but there are still hordes of people who have their complaints denied by the bank each and every day. Since the FOS charges the banks an £850 fee for every upheld complaint in addition to its judgments, and it also approves 80 percent of PPI complaints, the added fees alone cost the bank nearly £1 million each day. That’s nearly £30 million each month in addition to the payouts that it must make whenever it loses a decision, which happens most of the time.
Based on the statistical proof, it makes no sense whatsoever for Barclays to deny claims. The bank must pay an additional 25 to 35 percent for each claim that is approved by the FOS. When the 80 percent upholding rate of the FOS and the thousands of cases from Barclays customers it has on its plate is considered, £4 billion seems like a rather conservative figure.
Barclays Mis-Selling & PPI: News
Barclays increases Financial Mis-Selling compensation funds
Barclays is understood to publish its finacial mis-selling endevours this week and announce an increase in the compensation funds set aside to deal with three types of financial products mis-sold by the Banking Giant.
The three types of Barclays mis-sold financial products:
- Payment Protection Insurance
- Interest Rate Swaps
- Credit Card Identity theft cover
Mis-sold Interest rate swap costs Barclays £1.5mil in compensation
Barclays is to pay £1.5 million in compenation for a mis-sold interest rate swap according to the Guardian. The case has been in court for the past 3 years over an interest rate swap sold to a holiday resort owner in Cornwall.
The compensation will not be paid until further losses and hardship caused by the interest rate swap has been calculated.
The need to agree to these so-called consequential losses means Barclays has not yet paid out to any customers claiming compensation for mis-sold interest rate swaps, which were intended to protect customers against interest rate rises.
Barclays Investments Mis-Selling
The bank has been fined £7.7m by the Financial Services Authority and will pay up to £60m compensation to customers of two investment funds. One in seven of the 12,000 investors complained about the advice received from July 2006 to November 2008. Barclays accepted it had ‘let customers down’ and has apologised.
PPI Claims Service UK
Maple Leaf Financial have a specialist team of solicitors dedicated to dealing with the mis-selling of payment protection Insurance (PPI) products by the banks. We are happy to review these PPI products and to claim compensation for our clients where appropriate.
We will work with you to ensure that you get the correct PPI settlement or refund and any and all fair compensation that may be due to you as a result of PPI mis-selling. We will deal directly with your PPI provider, be it a bank or insurance company and neither we nor our specialist claims team will be fobbed off by them at any stage. If their offer is too low or derogatory and they won’t take us seriously we will challenge them on your behalf.
Tim Capper reports on Financial Mis-Selling for Maple Leaf Financial. Our aim is to ensure you get honest advice and proper guidance to ensure a suitable recommendation can be made to pursue a financial claim
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