Lloyds have ‘potentially harmed customers’ interests’ by committing a ‘serious’ Payment Protection Insurance (PPI) breach according to the Competition and Markets Authority (CMA).
PPI rules dictate that customers should be sent annual statements that allow them to keep track of their premiums, but an error meant that hundreds of Lloyds customers have not been sent the statements over the past five years.
Worse still some customers were sent the statements with incorrect information, resulting in over 200 customers being overcharged.
Chief Executive of the Alliance of Claims Companies (ACC) Simon Evans said: “How can the FCA be certain that a time bar is in the best interests of consumers, and that hundreds of thousands of consumers will not be placed in detriment, when we continue to see the major financial institutions dealing with PPI issues incorrectly?”
Lloyds told the Financial Times: “These issues have since been resolved. Nonetheless, we apologise for any inconvenience caused.”
No other lender has paid out more compensation for mis-sold PPI than Lloyds, with their bill standing at more than £17bn.
It is a further complication for one of the UK’s big high street banks, which performed poorly in a recent customer service poll and only saw 53% of customers nominating it in the ‘Most Trusted’ category.
It is estimated that £50bn worth of PPI policies were sold in total in the UK over the past 10-15 years and figures from the Financial Conduct Authority (FCA) show almost half that amount still remains unclaimed.
The FCA have confirmed a deadline on all PPI claims for 2019 and with timebars initiated by the banks 3 million people are estimated to have lost their chance to check in 2016, with a further 1.2 million set to lose out by the end of this year.