Whistleblower alleges ‘shocking’ mis-selling of Packaged Bank Accounts at Lloyds

A whistleblower has told the Financial Mail on Sunday that Lloyds used ‘shocking’ tactics to sell Packaged Bank Accounts to some of their customers.

The unnamed source speaks of a culture ‘obsessed with targets and profit’, and says that certain vulnerable groups of customers were targeted to be sold a fee-paying bank account.

The whistleblower said: “Staff and customers were treated very badly. Vulnerable people, including people who aren’t financially literate and those from Eastern Europe, were seen as easy prey as they didn’t know about UK banking, didn’t speak good English or wouldn’t know how to make a complaint.

Some were told packaged accounts were good for building a credit score. It was shocking and monstrous.”

The whistleblower also claims that packaged accounts would also earn staff 170 ‘points’ compared to just 30 ‘points’ for a free account. “Bearing in mind the difference in points, when an adviser is sitting in front of a customer, do you think they were more likely to sell a normal current account or a packaged account?” The whistleblower added.

Lloyds reply to the article stated the accusations were ‘unfounded and refer to practices and processes no longer in place’. They said: “Lloyds Banking Group does not have sales targets. We believe that in the vast majority of cases, packaged bank accounts provide good value to customers. Where we receive customer complaints, we review each one on a case-by-case basis. There is no evidence that staff were harassed.”

The article raises that mis-sold PBAs are a wider-reaching issue, saying: “Thousands of people have had valid claims backed by the Ombudsman, with banks told to issue refunds. It is believed many more could still be paying for accounts they should never have been sold and banks have reportedly set aside up to £1 billion to compensate those who complain. Lloyds put aside £225 million last year.”

Common grounds for mis-sell include not being given a choice to move to a fee-paying account, consumers being told they need a fee-paying account in order to get a loan or overdraft and not being made aware of limitations and restrictions of added features that come with the account, such as travel insurance.

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