The British Bankers’ Association is continuing to defend the way banks sold payment protection insurance, despite recent uproar over widespread PPI misselling.
Speaking at a Which? conference on financial services reform in London this week, BBA executive director of retail Eric Leenders set out why the trade body launched its judicial review into PPI redress measures, a case it lost in April.
Leenders said: “This is a classic area where we felt we had complied entirely with what was required. That is not just based on our internal risk, compliance and legal assessments, but the external advice we received as well.
“Those risk and compliance departments have been involved in conversations with the regulator since 2001 to make sure the paperwork and documentation was correct. To then say 10 years down the track ‘this is how it should have been done and you should have known’, puts the industry in a very invidious position.”
But Independent Commission on Banking member and former Ofgas director general Clare Spottiswoode said: “It is absolutely outrageous in my view that the banking industry can defend introducing the PPI product on the basis they did all the paperwork and complied with all the regulations.”
She added although large fines have been levied on banks as a result of PPI misselling, the fines do not equate to the large profits banks made by selling PPI.