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http://www.bbc.co.uk/blogs/x-ray/201...scrutiny.shtml
Swansea claims management firm under scrutiny
Post categories: coming up on X-Ray, money, stories
X-Ray production team | 18:00 UK time, Monday, 12 July 2010
In recent years, the banking industry has been heavily criticised for mis-selling payment protection insurance to borrowers who didn't need or want it. Now many consumers who are attempting to reclaim that money could be losing out again.
Figures from the Financial Ombudsman Service show that last year more than 10,000 people in Wales tried to reclaim the money they'd paid for payment protection insurance, or PPI, which was sold to them alongside loans and credit cards. Almost a third of them used one of a growing number of claims management companies. These firms often charge customers hundreds of pounds in up-front fees and up to 30% of any successful payout they receive.
All claims management firms are licensed and regulated by the Ministry of Justice and must follow strict regulations in the way they approach customers and handle their cases. Despite this, it appears that many are flouting these rules. To date, 189 claims firms have had their licences cancelled.
Michael Russell, a part time supermarket cleaner from Penmaenmawr was cold-called by a company with a familiar sounding name - Money Claiming Experts. Michael had taken out a £7,000 loan with Natwest in 2001 and says he was told that PPI was compulsory. His £120 monthly repayments are a fifth of his wages, so he was tempted by Money Claiming Experts' offer to help him reclaim the money.
"They said they were backed by the government which convinced me that they were kosher," he said. The company told him they'd take a 30% cut of any money he reclaimed, and they took an upfront fee of almost £300 before sending out any paperwork.
In doing so, the company appears to have breached two of the rules of conduct laid down by the Ministry of Justice. The regulations state that claims management firms must not cold-call customers and should not take any upfront fees until a customer has received pre-contract information in writing.
Unaware of these apparent rule breaches, two weeks later Michael received a call from Money Claiming Experts. "They phoned me saying I'd won the case and the bank was going to wipe the loan clear and I'd be getting around £2,000 back," he explained. But alarm bells began to ring when the company said it would take up to a year to get his money unless he paid a further £300 to fast track his claim.
Michael refused to pay the extra fee. And when he didn't get written confirmation of his refund or his loan being wiped out, he checked his bank account and saw that his Natwest loan payment had been taken as usual. He called and emailed Money Claiming Experts but had no response.
We spoke to Michael's bank Natwest who told us they'd had no contact from Money Claiming Experts and they certainly hadn't indicated that he's won his case or that his loan would be written off.
So who's behind the firm? Well, it's far from clear cut. The directors of the parent company, Client Connection, are Ryan Stanton, Damian Spooner-Cleverly and Kevin Kearle. But the company goes by other names too - Michael's letters are from Money Claiming Experts and he's been called by CCR Claims. Very confusing.
Michael is not the only disgruntled customer, according to consumer forums which detail complaints about the company's methods of cold calling and taking huge upfront fees.
And it's an industry wide problem, according to Phil Jones from consumer group Which?
"We certainly hear a lot about Claims Management Companies and we have been made aware of a lot of people who've had serious problems with losing money," Phil said. "Cases have been brought to the regulator and firms have been closed down. So we do have a perception that this is a serious problem which doesn't seem to be going away."
The Ministry of Justice says it will take action against companies which repeatedly break the terms of their licence, and it's already struck off almost 200 firms. We reported Money Claiming Experts' apparent breaches to them and they said they will investigate.
The good news is that anyone who's been mis-sold PPI can try to reclaim the money themselves without using a claims management firm. Many consumer websites have template letters - and you even can ask the Financial Ombudsman Service to write to your bank on your behalf. And the chances of success are high, with more than 90% of claims upheld.
Michael has now cancelled his contract with Money Claiming Experts and has made his own claim to Natwest which didn't cost him a penny. His bank is considering his case and says it will deal with him, not the claims company, in future.
Money Claiming Experts say that they are conducting a full investigation of Michael's case. They deny they've breached any of the Ministry of Justice rules and, on the matter of taking an upfront fee, they've failed to explain why the payment was taken before written material was received.
They deny they told Michael he'd 'won his case' during a telephone conversation and also deny they asked him for a further fee to speed up his claim. However, they do say they informed him he had a very strong case and that to date they've recovered in excess of £600,000 for their clients.
X-Ray reported Michael's experiences to the Ministry of Justice. They said they actively investigate complaints received about the conduct of any business and the conduct reported raises serious concerns and would represent a clear breach of the rules. They say they will look into the allegations and will take appropriate action, pointing out that any authorised business which breaches the rules of conduct could have their authorisation cancelled.
GUIDE TO RECLAIMING PPI
If you can answer 'no' to one or more of these questions, then you may have been mis-sold PPI and you could make your own claim to your bank or loan provider.
http://www.bbc.co.uk/blogs/x-ray/201...scrutiny.shtml
Swansea claims management firm under scrutiny
Post categories: coming up on X-Ray, money, stories
X-Ray production team | 18:00 UK time, Monday, 12 July 2010 In recent years, the banking industry has been heavily criticised for mis-selling payment protection insurance to borrowers who didn't need or want it. Now many consumers who are attempting to reclaim that money could be losing out again.
Figures from the Financial Ombudsman Service show that last year more than 10,000 people in Wales tried to reclaim the money they'd paid for payment protection insurance, or PPI, which was sold to them alongside loans and credit cards. Almost a third of them used one of a growing number of claims management companies. These firms often charge customers hundreds of pounds in up-front fees and up to 30% of any successful payout they receive.
All claims management firms are licensed and regulated by the Ministry of Justice and must follow strict regulations in the way they approach customers and handle their cases. Despite this, it appears that many are flouting these rules. To date, 189 claims firms have had their licences cancelled.
Michael Russell, a part time supermarket cleaner from Penmaenmawr was cold-called by a company with a familiar sounding name - Money Claiming Experts. Michael had taken out a £7,000 loan with Natwest in 2001 and says he was told that PPI was compulsory. His £120 monthly repayments are a fifth of his wages, so he was tempted by Money Claiming Experts' offer to help him reclaim the money.
Michael Russell with X-Ray's Rachel Treadaway-Williams
"They said they were backed by the government which convinced me that they were kosher," he said. The company told him they'd take a 30% cut of any money he reclaimed, and they took an upfront fee of almost £300 before sending out any paperwork.
In doing so, the company appears to have breached two of the rules of conduct laid down by the Ministry of Justice. The regulations state that claims management firms must not cold-call customers and should not take any upfront fees until a customer has received pre-contract information in writing.
Unaware of these apparent rule breaches, two weeks later Michael received a call from Money Claiming Experts. "They phoned me saying I'd won the case and the bank was going to wipe the loan clear and I'd be getting around £2,000 back," he explained. But alarm bells began to ring when the company said it would take up to a year to get his money unless he paid a further £300 to fast track his claim.
Michael refused to pay the extra fee. And when he didn't get written confirmation of his refund or his loan being wiped out, he checked his bank account and saw that his Natwest loan payment had been taken as usual. He called and emailed Money Claiming Experts but had no response.
We spoke to Michael's bank Natwest who told us they'd had no contact from Money Claiming Experts and they certainly hadn't indicated that he's won his case or that his loan would be written off.
So who's behind the firm? Well, it's far from clear cut. The directors of the parent company, Client Connection, are Ryan Stanton, Damian Spooner-Cleverly and Kevin Kearle. But the company goes by other names too - Michael's letters are from Money Claiming Experts and he's been called by CCR Claims. Very confusing.
Michael is not the only disgruntled customer, according to consumer forums which detail complaints about the company's methods of cold calling and taking huge upfront fees.
And it's an industry wide problem, according to Phil Jones from consumer group Which?
Phil Jones from Which?
"We certainly hear a lot about Claims Management Companies and we have been made aware of a lot of people who've had serious problems with losing money," Phil said. "Cases have been brought to the regulator and firms have been closed down. So we do have a perception that this is a serious problem which doesn't seem to be going away."
The Ministry of Justice says it will take action against companies which repeatedly break the terms of their licence, and it's already struck off almost 200 firms. We reported Money Claiming Experts' apparent breaches to them and they said they will investigate.
The good news is that anyone who's been mis-sold PPI can try to reclaim the money themselves without using a claims management firm. Many consumer websites have template letters - and you even can ask the Financial Ombudsman Service to write to your bank on your behalf. And the chances of success are high, with more than 90% of claims upheld.
Michael has now cancelled his contract with Money Claiming Experts and has made his own claim to Natwest which didn't cost him a penny. His bank is considering his case and says it will deal with him, not the claims company, in future.
Money Claiming Experts say that they are conducting a full investigation of Michael's case. They deny they've breached any of the Ministry of Justice rules and, on the matter of taking an upfront fee, they've failed to explain why the payment was taken before written material was received.
They deny they told Michael he'd 'won his case' during a telephone conversation and also deny they asked him for a further fee to speed up his claim. However, they do say they informed him he had a very strong case and that to date they've recovered in excess of £600,000 for their clients.
X-Ray reported Michael's experiences to the Ministry of Justice. They said they actively investigate complaints received about the conduct of any business and the conduct reported raises serious concerns and would represent a clear breach of the rules. They say they will look into the allegations and will take appropriate action, pointing out that any authorised business which breaches the rules of conduct could have their authorisation cancelled.
GUIDE TO RECLAIMING PPI
If you can answer 'no' to one or more of these questions, then you may have been mis-sold PPI and you could make your own claim to your bank or loan provider.
- If the insurance was optional, was that made clear to you?
- If you were self-employed, retired or unemployed and your policy included unemployment cover was it pointed out to you that this was worthless?
- Did the adviser tell you about any significant exclusions under the policy - for example, the exclusion that says you won't be covered for any pre-existing medical condition?
- If you took out a loan or finance agreement, did the adviser make it clear that you would have to pay for the insurance up front in one single payment?
- If you had to pay for the PPI as a single payment, did the adviser make it clear that the insurance cost would be added to the loan and you would be paying interest on it?
- Write to the company who sold you the policy and ask for a refund. Both the banks and the Financial Ombudsman have agreed on a questionnaire covering all the details that consumers should use for their initial claim:
www.financial-ombudsman.org.uk/consumer/complaints.htm (scroll down to the bottom of the page for the questionnaire).
If you are concerned about doing this yourself or are not too sure who you should be contacting about your claim, call the Financial Ombudsman. They can give free and independent advice, plus they can even write to the company if needed.
The consumer helpline is open from 8am to 6pm, Monday to Friday.- 0800 0 234 567 - free for people phoning from a landline.
- 0300 123 9 123 - free for mobile-phone users who pay a monthly charge for calls to numbers starting 01 or 02.
- If the company refuses your claim, write again, asking them to look at this again and indicate that you will get in touch with the Financial Ombudsman.
- Still no luck? This time get in touch with the Financial Ombudsman. This service is independent and impartial and aims to resolve issues between customers and financial companies. If your claim has been rejected or you reach a deadlock with the company you have six months to take your complaint to the Ombudsman Service. Check their website for details of how to complain.
