According to the BBC, the UK's Financial Services Authority is poised to fine up to 10 'big name' lenders around GBP1 million each for mis-selling payment protection insurance to customers, which could result in the firms facing thousands of compensation claims.
<p>Payment protection insurance (PPI) is a widely sold product, which covers policyholders if they find themselves unable to pay their mortgages or other loans due to illness or employment. However, PPI products have received much criticism in the public eye for their poor value. <br /><br />News of the fines may result in customers initiating compensation claims, following the belief they were mis-sold PPI. Consequently, this could potentially be very expensive for the major lenders, the names of which have not been disclosed.<br /><br />The crackdown on mis-conduct in selling PPI is in line with the UK regulatory body's previous announcement to improve sales standards at PPI selling firms. The Financial Services Authority has already fined three firms for mis-selling PPI, namely Regency, Loans.co.uk and Redcats.</p>