Important Info for CPP (Card Protection Plan) Claimants

[Bill-K]

This post in PAG may be of interest to CPP claimants:-

http://www.penaltyactiongroup.co.uk/...p?f=181&t=4762

[wales01man]

Re: Important Info for CPP (Card Protection Plan) Claimants

cannot register on PAG so cannot see it?

[Gorang]

Re: Important Info for CPP (Card Protection Plan) Claimants

Here's bills post for anyone that can't view it attachment is uploaded too

The FSA (now FCA) has declared that all Card Protection Plans were mis-sold, because they were simply not necessary, as the lenders themselves already had sufficient safeguards in place. For an annual fee (usually), customers could register all of their credit/debit/store cards with the one plan supplier, and were then covered if any or all of their cards were lost or stolen. These plans went under various names, but Card Protection Plan is probably the most common.

These payments can now be reclaimed in exactly the same way as mis-sold PPI payments - the only real difference being that there should be no requirement to show that they were mis-sold, as this has already been established by the FSA.

Many people have received packs from CPP Ltd., containing quite a lot of information which may be difficult to understand - so here's a summary, and an opinion:-

Basically, CPP Ltd. has been ordered by the FCA to send these packs to all customers who have been registered with them since 14/01/05 (when the FSA became the regulator of CPP products). They have put together a 'scheme,' which is designed to be a way of assessing whether each customer is entitled to a refund of their CPP charges, along with any compensatory interest. It also covers the way that any refunds are calculated, and it has the backing of the FCA.

PLEASE NOTE:-
If this scheme is voted in, then it will be the method used for calculating every CPP claim - regardless of whether the claimant voted for it or not - and the FOS will use the same method. Amy Ellis in MSE has recommended that we should vote 'yes' to the scheme, and I initially thought that was the best way to vote. But I have now had a read of the explanatory statement and I recommend that we vote 'no' to the scheme. However, I doubt if my own recommendations will have much effect on the vote, and I think the best thing that I/we can do is to try and get the scheme modified before its approval.

In the Explanatory Statement, paragraph 6.3 makes it clear that once the scheme has been approved, it will be rigidly imposed. Para. 14.1 explains that claimants will be refunded all CPP payments made since 14/01/05, plus 8% simple interest on those payments. But there is no mention at all of the apportioned debited account interest that was attributable to the CPP payments. This is the portion of the monthly account interest charged by the card provider/lender which would not have been charged if the CPP had not been taken out. Strangely, the FCA rule that for PPI claims, this interest must be refunded as well - but it is missing from the calculation here - even though CPP is in principle a similar type of insurance. If the scheme is voted in, then I believe it will then be extremely difficult - maybe impossible - to reclaim this interest.

Doing a fag-packet calc. with a hastily knocked-up spreadsheet I submit the following example. It assumes that a typical Ł30 per year CPP was paid from 14/01/05 until 14/01/13, and the redress eventually calculated to 14/07/14. Under the 'scheme,' the redress would be 9 years' payments of Ł30 p.a., plus 8% interest. This comes to Ł270 in CPP pmts. plus Ł118.71 in 8% compensatory interest - totalling Ł388.71.

Using exactly the same figures, but using the method of calculation that is prescribed by the FCA for the calculation of PPI redress (instead of the 'scheme' method). assuming a balance that rises steadily from Ł300 to Ł3000, and a steady credit card APR of 19.9%, the redress would be Ł270 in CPP pmts., plus Ł385.98 in apportioned account interest, plus Ł177.38 in 8% compensatory interest - totalling Ł833.36. That's an increase of over 114%.

Doing the same, but with an APR of 29.9%, the total redress comes to Ł1,175.50. That's an increase of over 202% !!!

Adding a typical Identity Protection Policy at Ł80 per year to the above, the three totals are:
Ł1,425.25
Ł3,055.69
Ł4,310.09

There is a creditors' meeting in connection with this scheme at Wembley Arena on 07/01/14, at which final votes will be taken and approval for the scheme will be considered - with or without modifications. I feel it is too late to do much about changing the vote, which I am sure will be in favour of the scheme. But it seems possible that the inclusion of apportioned account interest in the redress calculations could be put forward as a modification. If sufficient weight can be put behind such a proposal, then there is a chance that it will be implemented.

Chartered Accountants Kevin Gill and Ben Cairns have been appointed as administrators of the scheme. They are both Partners at Ernst & Young LLP, 1 More London Place, London SE12AF, and Kevin Gill has been appointed as Chairman of the creditors' meeting with Ben Cairns deputising if necessary. I believe that if sufficient numbers write to both Kevin and Ben to suggest this modification, there is a chance that it will be considered seriously - and if the weight of the FCA & FOS can be put behind it, then that will give it a really good chance. Media attention may add to this as well, of course.

If the modification doesn't get approved at the meeting, then I believe there may be one last final chance because the scheme must be approved by the Companies Court in the Chancery Division of the High Court of Justice. The hearing for this is expected to be on 14/01/14, and all Scheme Creditors are entitled to attend the Hearing to support or oppose the Scheme. There is therefore a chance to get it modified or rejected by the Court, I hope.

[leclerc]

Re: Important Info for CPP (Card Protection Plan) Claimants

My boss received the voting form recently and having looked at MSE advised her to vote YES to the proposal on that basis.

[Bill-K]

Re: Important Info for CPP (Card Protection Plan) Claimants

cannot register on PAG so cannot see it?

You should be able to register, Wales - but I see Gorang has obliged with a copy of the post, so problem solved.

My boss received the voting form recently and having looked at MSE advised her to vote YES to the proposal on that basis.

I initially thought a 'yes' vote to be best, until I finally got a hold of the Scheme Explanation and read the small print. It was probably Amy Ellis's article in MSE that your boss read, leclerc:-

http://www.moneysavingexpert.com/new...et-to-vote-yes

Ernst & Young don't exactly have a glittering CV either:-

http://www.thisismoney.co.uk/money/n...=feeds-newsxml

http://www.bbc.co.uk/news/uk-england-wiltshire-25451221

...and Wikipedia lists quite a few other 'offences' that need to be taken into account.

[CYNthesys]

Re: Important Info for CPP (Card Protection Plan) Claimants

Thanks for that Bill
Ive had my voting form on one side for weeks, because I was unsure how to vote.

If I dont return the voting form am I right in assuming my vote will be an automatic NO?

[Bill-K]

Re: Important Info for CPP (Card Protection Plan) Claimants

As I understand it, CYN, if you don't vote, then your vote will not be counted on either side. TBH, I doubt if any further votes at this late stage will have any influence. This is why I believe that the only course of action is to press for a modification to the Scheme prior to - or at - the Wembley meeting. FWIW - if you still have the option to cast your vote, then I can only now suggest that you vote 'NO' to the implementation of the Scheme as it is currently proposed.

LB Admin are now aware of this , and I think their comments on this matter might be useful, as I am no more than a rank amateur posting in the wilderness.

[CYNthesys]

Re: Important Info for CPP (Card Protection Plan) Claimants

I will vote NO then Bill, got about 10 days left to meet deadline

[Bill-K]

Re: Important Info for CPP (Card Protection Plan) Claimants

In the clear absence of any response from LB admin, I assume there is no interest in this. Nevertheless, I have written to the CPP Scheme Administrators, the FCA and the FOS - to voice my own concerns. However, I am sure that if this matter should ever involve such issues as Statutory Demands, it would receive maximum attention here - and I will endeavour to achieve that.

[enaid]

Re: Important Info for CPP (Card Protection Plan) Claimants

I have this form to do for my dad and looking through stuff (quickly I may add) think I will vote no on his behalf.
Bill I really don't know what your problem is yet again, but am sure it is pointed once again at Cel.
I really don't understand why you should think she knows any more about this subject than any one else tbh as far as I can see it is read and make up your own mind then wait for your refund if it goes the right way.

[Bill-K]

Re: Important Info for CPP (Card Protection Plan) Claimants

You seem to have misunderstood me, Enaid. I don't have a problem, and I'm not asking for help or advice with this as I never took out CPP. I don't know where you got the idea that I thought Cel knew much about CPP, as we are all very much aware that SD's are her current forté. If you read my posts, I am actually offering advice on the subject for anyone who cares to take it - and not asking for any.

Unfortunately, I doubt very much that your vote will make any difference now - and if you read the post that Gorang has kindly copied from PAG for me, you will see that I am suggesting that CPP claimants urgently write to EY, FCA & FOS in order to get the CPP Scheme modified. As it stands, most claimants will get less than half of their entitlement under FCA rules - and many will get less than a third.

...as far as I can see it is read and make up your own mind then wait for your refund if it goes the right way.

Yes - but you need to see a bit further than that Enaid, I'm afraid - so you do need to read thoroughly and understand what I am saying, and I'm sorry if I haven't made myself clear. IMO, your vote is of no consequence now, and all CPP claimants need to urgently write to the above mentioned parties before the CPP Scheme meeting on 07/01/14. Just mindlessly ticking a box and waiting for your refund is not the advice I am offering, and is not the advice that I suggest that LB offers. Alas, it seems to have fallen upon deaf ears.

For those few that may be interested, here are the letters wot I rote to the various parties in the matter. If anyone feels inclined, then they need to send their own versions off ASAP First Class Post. If nobody is bovvered, then that's fine by me - I have offered my advice, and that's all I'm doing - peeps can take it or leave it.

[Bill-K]

Re: Important Info for CPP (Card Protection Plan) Claimants

I'm sorry, but I don't seem to have got my message across at all - it's the best I could do, I'm afraid, but it has clearly fallen upon stony ground. Ah well - I did my best at least, FWIW.

Thank you nevertheless to jakeP for providing us with an embedded link to a payday loan company. I have thanked your post, jakeP - as I assume that LB Team will at least be able to understand it, even if they cannot understand mine, and I am sure they will similarly thank you.

EDIT: Ooops - jakeP's post has disappeared, along with my thanks for it. There's nowt as queer as folk, eh ?

[Amethyst]

Re: Important Info for CPP (Card Protection Plan) Claimants

We can confirm that the High Court has today (14 January 2014) sanctioned the Scheme to review claims and, where appropriate, pay redress to customers. The Scheme will become effective on or around 31 January 2014, when the Court order sanctioning the Scheme is filed at Companies House.
Customers do not need to do anything now. We will write to all eligible customers again in due course with further detail on how to claim compensation.
via CPP Redress Scheme.