Money News: Loans.co.uk is fined £455,000 as City hit squad strikes again
Sunday 29 October 2006
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."
Questions of Cash: Bupa costs bore no relation to what I'd been quoted
Five Questions On: Pensions advice
Problem gambling: Amid heavy advertising and a surge in remote sports betting, more and more 16 to 24-year-olds are now seen as 'at risk'
Gardens add a tenth to the value of your home
Simon Read: Retirement advice is good - if it's impartial
- 1 Is Gideon Levy the most hated man in Israel or just the most heroic?
- 2 Students offered grants if they tweet pro-Israeli propaganda
- 3 Satellite full of sexually experimental geckos adrift in space, Russia loses control of mission
- 4 Exclusive: Cameron’s Big Society in tatters as charity watchdog launches investigation into claims of Government funding misuse
The 'scroungers’ fight back: The welfare claimants battling to alter stereotypes
Arizona execution lasts two hours as killer Joseph Wood left 'snorting and gasping' for air
Malaysia Airlines MH17 crash: Ukrainian military jet was flying close to passenger plane before it was shot down, says Russian officer
Malaysia Airlines MH17 crash: Massive rise in sale of British arms to Russia
A day in the life of Vladimir Putin: The dictator in his labyrinth
Malaysia Airlines MH17 crash: victims’ bodies bundled in black bags and loaded onto trains
iJobs Money & Business
£600 - £650 per day: Orgtel: Conduct Risk Liaison Manager - Banking - London -...
£18000 - £23000 per annum + Comission: SThree: SThree, International Recruitme...
£280 - £300 per day + competitive: Orgtel: Test Analyst, Edinburgh, Credit Ris...
£20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...
Day In a Page
A three-bedroom 16th-century home with an aga kitchen, private gardens and heated outdoor pool, in Hadleigh
A three-bedrom home in sought-after Queen's Gate Mews, with Italian marble-finished bathrooms
Surrounded by glorious countryside in the village of Udimore, sits this impressive four-kiln oast and barn conversion
A five-bedroom house in the picturesque village of Kettlewell, north Yorkshire
An 18th-century former coaching inn with original staircase, open fireplaces and beams throughout
A Grade II-listed Georgian town house with three bedrooms and a south-facing courtyard, near Arundel Castle
Feel on top of the world at this über chic penthouse on the 37th floor of one of Europe’s tallest blocks.
A Grade II-listed Victorian villa with six bedrooms and two further cottages, all with spectacular sea views
A grade II-listed, Georgian cottage with mature 50ft garden, perfect for summer entertaining
A magnificent Georgian pile with turrets, seven bedrooms, a heated pool and four acres of gardens
Fairoak Farm has five bedroom suites, gym, outdoor swimming pool and golf course
Chic two-bedroom river-fronted flat with a private lift that delivers you directly to your home
A spectacular seven-bedroom Tudor pile, once owned by Henry VIII, with 18 acres of land
A seven-bedroom Georgian property previously used as a picturesque wedding venue
A split-level flat in a church conversion with two en suite bedrooms and 1,200sq ft of living space
A three-bedroom bungalow situated behind an impressive stone wall, £645,000
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads
Chapel House is a former vicarage with nine bedrooms in the beautiful Upper Wye Valley
A five-bedroom B&B and separate owner's accomodation with potential for conversion
Enjoy summer by the Thames in this two double-bedroom converted warehouse in Rotherhithe village
A one-bedroom, luxury apartment with private gym and concierge service in Moorgate
A four-bedroom house in Hermitage Gardens with three reception rooms and landscaped gardens
A seven-bedroom Grade II-listed property with a separate self-contained apartment
A five-bedroom Victorian house with three reception rooms and galleried landing, £695,000
A six-bedroom farmhouse with five acres of land in a former cloth-making village
A secluded seven-bedroom detached house with large private garden, £490,000
A three-bedroom cottage overlooking Sarratt village green with open fires and solid oak floors
A three-bedroom maisonette flat in a Grade I-listed, Georgian townhouse in a sought-after location
A one-bedroom apartment located within a private gated development, north of Turnham Green
Look forward to a brighter future at two-bedroom Sunny Cottages, ideal for Londoners looking to downsize
A three-bedroom red-brick cottage with outbuildings and pretty gardens, £200,000
This three-bedroom flat within a former textile factory spans the corner of the fourth floor and has a balcony
A charming four-bedroom Oxfordshire cottage with oak floors and chunky-beamed ceilings, £465,000
A beautiful one-bed flat in a sought-after portered block, with access to Norland Square communal gardens
A one-bedroom flat within a Sixties school conversion with high-spec design and open-plan kitchen, close to Lambeth North Tube, £435,000
A 17th century four-bedroom house, with open fireplaces, cellar and pool, £600,000
A three-bedroom, coach house with luxury open-plan living space and contemporary breakfast bar