Reclaim Egg PPI
Egg Banking plc were fined by the Financial Services Aurthority (FSA) for serious failings on credit card Payment Protection Insurance (PPI) phone sales between January 2005 and December 2007. During this period Egg sold approximately 106,ooo credit card PPI policies at an average of £156 each.
Penalty given: £721,000
Reasons for this penalty:
- Failings in approximately 40% of telephone sales
- Persuasive sales techniques used on customers who refused PPI
- Failure to obtain customer consent to receive limited PPI policy information
- Applying PPI to customers credit cards even in cases where it was not consented
- Inappropriate sales techniques
- Failure to take responsible care when organising and controlling their affairs
- Failing to treat customers fairly
- Failures in paying due regard to customers needs and interests
- Failing to provide sufficient information when customers asked of the costs of PPI
What the FSA said:
“Egg used inappropriate sales techniques to try to persuade customers to buy payment protection insurance on their credit card even when they asserted they did not want the cover. All firms must ensure that customers are treated fairly when selling PPI and if a customer does not want PPI, they should not be pressured into taking it.
“We will continue to fine firms where we find PPI failings. It is unacceptable that Egg did not identify the problems with its sales processes despite a series of high profile FSA communications on PPI, including earlier fines on other firms. Egg stopped telephone sales of credit card PPI in December 2007, and has agreed to write to customers and pay a full refund plus interest where appropriate. Egg is likely to pay substantial compensation as a result of this exercise.”
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