Which Banks and Financial Institutions Were Involved in the PPI Scandal?
Claim Back up to 30 Years of mis-sold PPI
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PPI is now referred to as the UK’s biggest financial scandal of all time, but how did payment protection insurance begin and who were the major players in this great scandal that has rocked the UK’s financial industry? The PPI, by all intents, began as a genuine attempt to cover borrowers against any future inability to pay up loans ranging from mortgage, credit card debts, or unsecured loans. This was done in case those customers would be unable to settle those debts in the future due to factors such as illness and unemployment which might lead to loss of income.
So this was a standard insurance product but it was “mis-sold” by slick insurance salesmen and frontline staff as most customers were not aware of what they were paying for, and in some cases customers were even pressured into purchasing the PPI claims.
Banks involved with the scandal
All the major UK banks and building societies sold PPI often in cooperation or collusion with affiliated insurance companies. Those banks are now represented under the umbrella of British Bankers Association. Some of the top insurance companies and brokers were also involved in the sales of PPI include Aviva Life Insurance, Prudential, Friends Life, Phoenix and Royal London. Amongst the British Banks, Lloyds was one of the leading distributors of PPI along with HSBC, RBS-NatWest, Co-op, Santander, Nationwide, Clydesdale, and Barclays. Here are a few of the banks that distributed the PPI products to their customers and are currently mired in multi-billion pound PPI compensation claims.
Lloyds was one of the largest distributors of PPI services in the UK and the British bank received the largest number of at over 860,000 PPI complaints in the first 6 months of 2012. Lloyds has paid out over £2 billion so far and is expected to run out of its allocated PPI compensation provisions in November this year.
Barclays was another major distributor of PPI to its clientele and has so far received the largest number of individual compensation claims at 442, 266. The bank is expected to run out of its PPI provisions by December this year.
Royal Bank of Scotland
RBS has received 362,869 PPI compensation claims and its PPI compensation provisions will likely run out by March 2013
HSBC is also amongst the major banks that actively distributed PPI although it has not been faced with the scale of PPI compensation claims as the other big three. At the current rate of compensation, HSBC is expected to deplete its provisions by August next year.
Many other smaller banks that are members of the British Bankers Association along with building societies were also involved in the PPI scandal although not on a scale similar to that of the biggest financial institutions in the UK.