New FCA Statement on PPI complaints
The FCA has issued a new statement regarding its intention to consult on two key areas regarding PPI mis-selling complaints. Firstly, whether a deadline should be imposed for complaining to the Financial Ombudsman Service about PPI; secondly, how firms should deal with PPI complaints regarding undisclosed commission in the wake of Paragon v Plevin.
On the first issue, the FCA considers that a deadline for PPI complaints, together with a communications campaign, is desirable in the interests of finality and certainty. In respect of the second issue, the FCA proposes that firms should presume that undisclosed commissions of 50% or higher give rise to an unfair relationship under section 140A of the Consumer Credit Act 1974 and that the appropriate redress in such cases is the difference between the commission received and a 50% commission; for example, in the case of a 66% commission the appropriate redress would be 16% (together with historic and statutory interest).
The FCA intends to publish its consultation before the end of the year.
The FCA statement can be viewed here.