Reclaim HFC Bank PPI
HFC Bank Ltd (HFC) were fined by the Financial Services Aurthority (FSA) for putting their customers at risk of being sold Payment Protection Insurance (PPI) that wasn’t suitable for them. Between January 2005 and May 2007 HFC sold 163,000 PPI policies totally 75% of loans provided. During this period HFC traded in the names ‘Household Bank’ and ‘Beneficial Finance’.
Penalty given: £1,085,000
Reasons for this penalty:
- Failure in gathering sufficient information about their customers personal and financial circumstances
- Failing to take customers individual circumstances into account when considering if PPI would be suitable
- Failure in making sure that suitable advice was given to customers
- Failing to have adequate systems and controls in place for the selling of PPI
- Failing to inform customers why they had recommended them the PPI policy
- Failing to keep sufficient records to provide proof that sales were suitable
- Lack of effective systems to monitor staff for unsuitable sales
- Inadequate staff training
- Inadequte risk management systems
- Failing to treat customers fairly
What the FSA said:
“We are determined to see much better practice in the PPI market. We announced in September that we would be imposing higher fines for serious failings in the retail market including against firms who fall short in relation to PPI. The fine against HFC – the biggest PPI fine to date and first since our September announcement – is evidence of our determination in this area. HFC’s failings put its customers at risk of buying unsuitable protection insurance and the financial impact on them of unsuitable advice was likely to be significant.”
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