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FOS receives over 5,600 false PPI complaints

Over 5,600 complaints about missold payment protection insurance were referred to the Financial Ombudsman Service last year where no policy had ever been sold, figures from the FOS reveal.

The FOS has published its annual review this morning, which sets out complaints trends for the 2011/12 financial year.

Its figures show that out of the 222,333 complaints resolved during the year, 5,667 cases – 2.5 per cent of the total – were classed as “frivolous and vexatious”, compared to 0.9 per cent in the previous year.

99 per cent of frivolous and vexatious complaints were about missold PPI where no policy was in place.

The FOS received 157,716 complaints about PPI, up 51 per cent compared to the 104,597 PPI cases as at the end of March 2011. PPI now accounts for 60 per cent of the FOS’ workload.

Claims management companies brought 46.5 per cent of cases to the FOS on behalf of consumers, compared to 42.5 per cent of complaints made by consumers themselves.

The FOS says: “During the year we have again seen some claims management companies taking a disappointingly lax approach to completing the questionnaire on behalf of consumers.

“Where a form is completed inaccurately, or not at all, we may not be able to progress the complaint. We have made our position on this very clear to the claims management companies in question, And we have required a number of them to withdraw their complaints and to re-complete the questionnaires again in full.”

The FOS says it is both “frustrating and time-consuming” where the facts of the case are only established after it is referred to the service.

It adds: “We have also continued to see a significant number of cases where, after investigation, it emerged that no PPI policy had ever been in place.

“It is essential that businesses and claims management companies make every effort to check this before the matter is referred to the ombudsman service.”

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Comments

There are 5 comments at the moment, we would love to hear your opinion too.

  1. To put this in context, we also need to know:
    1) How many PPI complaints did the banks say had no PPI, and then it was later found there was
    2) Of the 5,600, how many of these cases did not get a decision letter at 8 weeks or the letter was not robust in explaining that there was no PPI.

    I abhor the generic complaints about PPI, but equally, if part of the problem with PPI is that customers didn’t know they had it, then they are going to complain about loans where it may not have been sold.

    Hopefully FOS has provided a list of the claims management companies to the MoJ.

  2. If not PPI policy was in place – surely the claim in an attempt at fraud. This is no different than making a claim under an insurance policy where the item never existed.

    Why arent the police involved?

  3. Why doesn’t the FOS charge for the time taken in receiving, administrating and adjudicating in the 5600 cases. Who knows such an action COULD reduce our feels and put some of these parasites off making spurious claims and stop wasting peopes time making unsolicitored calls.

  4. So where has the integrity gone? Making false claims is surely fraud? These claims firms should be struck off and clients and these firms should be billed for false claims which we are footing the bill for.

    I often get calls on my work number text messages from claims firms saying i’m owed £x,xxx. Failure to act even which the data showing firms are actively making false claims is another failure of the system.

  5. The FOS says it is both “frustrating and time-consuming” where the facts of the case are only established after it is referred to the service”.
    but hey! Advisers pay for this time consuming nuisance so what the heck.
    “It is essential that businesses and claims management companies make every effort to check this before the matter is referred to the ombudsman service.”
    Claims management companies definitely do NOT do this, so why should businesses spend time and money replying to non existant claims?
    How would John Lewis or M&S respond to a complaint about a product you had not purchased?
    Any CMC escalating a false claim to FOS should be fined and banned if persistant.
    The lunatics really are running the asylum.

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