Some leading banks may have underpaid compensation certain customers are due for mis-sold Payment Protection Insurance, the BBC has learned.
One expert, commissioned by the BBC, estimates it could amount to "somewhere in the region of £1bn". The customers potentially affected had PPI on credit cards issued by Lloyds Banking Group, Barclays, MBNA and Capital One. All claim to make every effort to pay a correct amount of compensation. The extent of the shortfall is difficult to assess. The shortfall in compensation arises because, although these banks all refunded the premiums on their mis-sold PPI policies plus interest as regulators require, they have been failing correctly to refund additional charges which were triggered by the premiums of the mis-sold PPI policies.
Some of those premiums put people over their borrowing limits, meaning they were then charged an additional fee. This failure to include fees and charges in compensation calculations has resulted in dramatic reductions to the amounts some customers have.....Read more here