GE Capital fined over mis-sales of PPI
A major UK finance company, which is the driving force behind many stores cards that are used in the UK, has been fined by the Financial Services Authority over the mis-sale of payment protection insurance. This type of financial insurance cover has come under intense fire from MPs, the Office of Fair Trading, and the Financial Services Authority recently, with many claiming that consumers are getting a raw deal and are being sold PPI plans that are totally inappropriate for them.
A number of UK lenders are in the firing line in terms of being fines for mis-selling this type of insurance cover, with at least ten well known financial institutions set to receive hefty fines over the sale of this cover. According to reports GE Capital has now been fined over six hundred thousand pounds for mis-selling the insurance cover. The Financial Services Authority stated that the company did not have control of the sales of their insurance, and that the company treated consumers unfairly when it came to sales of PPI.
So far, this is thought to be the largest fine from the FSA in relation to the sale of PPI, which is a type of protective insurance cover that protects borrowers in the event that they are unable to keep up with repayments on certain financial commitments. However, many of these plans have been branded inappropriate. This is an industry that has been reaping profits, worth over five billion pounds a year.
FSA director of enforcement Margaret Cole said: "Millions of people take out store cards every year. They need to know that PPI is almost always optional and should consider whether they need it before signing up. Our focus on Payment Protection Insurance will remain very high this year. We are determined to see significantly better practice in PPI sales and will crack down where firms fail to treat their customers fairly."
6th February 2007
These days, financial advisors and banks will always give you one vital piece of advice when you are considering borrowing any amount of money, from anyone. That advice is to shop around. By shopping around, you gain a number of benefits that are virtually unobtainable in any other way.
If you have payment protection on any personal loans that you may have made, did you know that you could be paying upwards of £2000 on top of the original debt including the interest?