Banks Face Huge Bill After PPI Court Case
The British Bankers' Association (BBA) has lost a High Court challenge brought over new regulations to control the selling of payment protection insurance (PPI) to borrowers. The judgement means consumers who took out PPI will have to be contacted by providers over the mis-selling scandal, to agree potential settlements. Mr Justice Ouseley, sitting in London, was told the new regulations could cost the industry up to £4.5bn in compensation payments. The Financial Services Authority (FSA) estimates PPI providers will have to pay out up to £1.3bn for new complaints received over the next five years. Banks face additional bills of up to £3.2bn following reviews of previous PPI sales and pro-actively contracting customers to offer them redress. They have been accused of generating millions of pounds in profit by mis-selling PPI. The FSA says customers deserve to be treated fairly over PPI The banks, represented by the BBA, challenged the FSA and the Financial Ombudsman Ser...