The Financial Services Authority (FSA) today published proposed guidance for firms that sold payment protection insurance (PPI) and are beginning to contact customers who may have been mis-sold a policy but have yet to complain. The guidance outlines steps firms should take when writing to these customers. It stresses the importance of these communications explaining clearly why the customer may have been mis-sold and could be entitled to redress, what the customer should do to respond to the firm, the time limits involved and the need to act promptly.

The letters are part of a process being undertaken by PPI firms to establish what caused the large number of complaints; this is called ‘root cause analysis’. When an FSA authorised firm identifies recurring or systemic problems in its sales processes it is required to correct them. The firm should consider what action it may need to take to treat fairly affected customers that have not complained – including contacting them and giving them the opportunity to claim redress....Read more here--: CCR Magazine - FSA publishes guidance consultation to help firms provide redress to victims of PPI mis-selling

Banks could end up paying an extra £6.4billion in controversial payment protection insurance payouts to millions of ‘forgotten victims’, new Money Mail research shows. The City watchdog, the Financial Services Authority, is ordering banks, insurers and brokers to write to 12million PPI customers who have yet to claim, telling them they may be due a payout. Money Mail has seen insider industry calculations which show that, if just six in every ten people respond to the mailshot and are successful, it will take the expected total PPI compensation bill to £14billion. This would blow a huge hole in the banks’ own provisions for the mis-selling scandal, currently £7.6billion including administration costs, and force a major rethink on how they plan to compensate customers.....Read more HERE