Money News: Loans.co.uk is fined £455,000 as City hit squad strikes again

The Financial Services Authority has fined credit broker Loans.co.uk £455,000 for failing to treat its customers fairly over the sale of payment protection insurance (PPI).

The company did not have sufficient controls in place to "minimise the risk of unsuitable sales", said the City regulator.

PPI is sold with loans, and is designed to pay out if the borrower is unable to make repayments because of accident, sickness or unemployment. But policies can be overpriced and mis-sold, often using high-pressure sales tactics, to people for whom they have little or no value - such as the self-employed.

Loans.co.uk, which sells PPI over the phone with loans, failed to gather and record information to show that the policy recommendations it had made were suitable, the FSA said.

And, it added, customers did not receive sufficient information at the point of recommendation to make an informed decision about the PPI policy on offer.

According to the watchdog, as many as 14,400 people were exposed to the risk of buying PPI that was unsuitable for their needs.

Loans.co.uk is the second company in as many months to be hit with a fine over PPI: last month, Regency Mortgage Corporation was fined £56,000 for "PPI failings".

Since Loans.co.uk agreed to settle its case early, the FSA reduced the penalty by around a third. The company says it has had new practices in place for the past six months, and is contacting customers to offer redress where appropriate.

The £5.5bn PPI market is to be the subject of a full investigation by the Competition Commission after a report by the Office of Fair Trading found it was "failing consumers".

Advertising: Lloyds TSB rapped over mailshot

A "handwritten" promotional leaflet from Lloyds TSB bank has come under fire from the Advertising Standards Authority for misleading the public.

The leaflet was designed to look like a folded hand-written note, and was stamped with the words "chosen by your neighbours". The ASA said recipients could have been misled into thinking the bank's home insurance had been recommended by someone they knew.

It also criticised a similar mailing that resembled post that had been redirected by a neighbour.

It said: "Redirect - I got a great deal on my home insurance with these guys. Just thought you might be interested." According to the ASA, it was not made clear that the leaflets were advertising material.

Lloyds TSB said it had chosen this marketing approach because it believed it was the UK's "number one" home insurance provider - and claimed this meant it was statistically most likely to be insuring the recipient's neighbour. All the leaflets were printed with the Lloyds TSB Insurance logo to make them "readily identifiable". But the bank issued an apology and said it had not intended to mislead people.

It told the ASA it had "no further plans to use the material in its current form".

Pensions: Earnings link 'will be too late' for millions

Hundreds of pensioners marched on Parliament last week to lobby for an increase in the basic state pension.

Members of the National Pensioners Convention (NPC) dressed up as "skeletons" on Wednesday to stress that half a million elderly people die every year, and to demand that the needs of the old are not ignored in the Government's reform of pensions.

Campaigners said up to three million pensioners would die without seeing any benefit from the Government's plans to restore the link between pensions and average earnings. The reform is not scheduled until 2012 at the earliest.

The NPC, which represents more than 1,000 pensioner groups, says this will be too late for many pensioners. It is calling on MPs to reinstate the link with immediate effect. It is also wants the state pension raised from £84.25 to £114 a week.

Joe Harris, general secretary of the NPC, said: "One in five older people live below the poverty line and millions more are being forced into hardship by fuel and council tax bills."

News
Susan Sarandon described David Bowie as
peopleSusan Sarandon reveals more on her David Bowie romance
Sport
Arsenal supporters gather for a recent ‘fan party’ in New Jersey
football
News
i100
Sport
sportDidier Drogba returns to Chelsea on one-year deal
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
Arts and Entertainment
The Secret Cinema performance of Back to the Future has been cancelled again
film
Life and Style
Balmain's autumn/winter 2014 campaign, shot by Mario Sorrenti and featuring Binx Walton, Cara Delevingne, Jourdan Dunn, Ysaunny Brito, Issa Lish and Kayla Scott
fashionHow Olivier Rousteing is revitalising the house of Balmain
News
i100
Arts and Entertainment
Christian Grey cradles Ana in the Fifty Shades of Grey film
filmFifty Shades of Grey trailer provokes moral outrage in US
News
people
News
BBC broadcaster and presenter Evan Davis, who will be taking over from Jeremy Paxman on Newsnight
peopleForget Paxman - what will Evan Davis be like on Newsnight?
Life and Style
fashionCustomer complained about the visibly protruding ribs
News
newsComedy club forced to apologise as maggots eating a dead pigeon fall out of air-conditioning
Arts and Entertainment
Jo Brand says she's mellowed a lot
tvJo Brand says shows encourage people to laugh at the vulnerable
Life and Style
People may feel that they're procrastinating by watching TV in the evening
life
News
Tovey says of homeless charity the Pillion Trust : 'If it weren't for them and the park attendant I wouldn't be here today.'
people
Sport
Rhys Williams
commonwealth games
Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Senior Risk Manager - Banking - London - £650

    £600 - £650 per day: Orgtel: Conduct Risk Liaison Manager - Banking - London -...

    The benefits of being in Recruitment at SThree...

    £18000 - £23000 per annum + Comission: SThree: SThree, International Recruitme...

    Test Analyst - UAT - Credit Risk

    £280 - £300 per day + competitive: Orgtel: Test Analyst, Edinburgh, Credit Ris...

    Trainee Recruitment Consultants - Banking & Finance

    £20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...

    Day In a Page

    Evan Davis: The BBC’s wolf in sheep’s clothing to take over at Newsnight

    The BBC’s wolf in sheep’s clothing

    What will Evan Davis be like on Newsnight?
    Finding the names for America’s shame: What happens to the immigrants crossing the US-Mexico border without documents who never make it past the Arizona desert?

    Finding the names for America’s shame

    The immigrants crossing the US-Mexico border without documents who never make it past the Arizona desert
    Inside a church for Born Again Christians: Speaking to God in a Manchester multiplex

    Inside a church for Born Again Christians

    As Britain's Anglican church struggles to establish its modern identity, one branch of Christianity is booming
    Rihanna, Kim Kardashian and me: How Olivier Rousteing is revitalising the house of Balmain

    Olivier Rousteing is revitalising the house of Balmain

    Parisian couturier Pierre Balmain made his name dressing the mid-century jet set. Today, Olivier Rousteing – heir to the house Pierre built – is celebrating their 21st-century equivalents. The result? Nothing short of Balmania
    Cancer, cardiac arrest, HIV and homelessness - and he's only 39

    Incredible survival story of David Tovey

    Tovey went from cooking for the Queen to rifling through bins for his supper. His is a startling story of endurance against the odds – and of a social safety net failing at every turn
    Backhanders, bribery and abuses of power have soared in China as economy surges

    Bribery and abuses of power soar in China

    The bribery is fuelled by the surge in China's economy but the rules of corruption are subtle and unspoken, finds Evan Osnos, as he learns the dark arts from a master
    Commonwealth Games 2014: Highland terriers stole the show at the opening ceremony

    Highland terriers steal the show at opening ceremony

    Gillian Orr explores why a dog loved by film stars and presidents is finally having its day
    German art world rocked as artists use renowned fat sculpture to distil schnapps

    Brewing the fat from artwork angers widow of sculptor

    Part of Joseph Beuys' 1982 sculpture 'Fettecke' used to distil schnapps
    BBC's The Secret History of Our Streets reveals a fascinating window into Britain's past

    BBC takes viewers back down memory lane

    The Secret History of Our Streets, which returns with three films looking at Scottish streets, is the inverse of Benefits Street - delivering warmth instead of cynicism
    Joe, film review: Nicolas Cage delivers an astonishing performance in low budget drama

    Nicolas Cage shines in low-budget drama Joe

    Cage plays an ex-con in David Gordon Green's independent drama, which has been adapted from a novel by Larry Brown
    How to make your own gourmet ice lollies, granitas, slushy cocktails and frozen yoghurt

    Make your own ice lollies and frozen yoghurt

    Think outside the cool box for this summer's tempting frozen treats
    Ford Fiesta is UK's most popular car of all-time, with sales topping 4.1 million since 1976

    Fiesta is UK's most popular car of all-time

    Sales have topped 4.1 million since 1976. To celebrate this milestone, four Independent writers recall their Fiestas with pride
    10 best reed diffusers

    Heaven scent: 10 best reed diffusers

    Keep your rooms smelling summery and fresh with one of these subtle but distinctive home fragrances that’ll last you months
    Commonwealth Games 2014: Female boxers set to compete for first time

    Female boxers set to compete at Commonwealth Games for first time

    There’s no favourites and with no headguards anything could happen
    Five things we’ve learned so far about Manchester United under Louis van Gaal

    Five things we’ve learned so far about United under Van Gaal

    It’s impossible to avoid the impression that the Dutch manager is playing to the gallery a little