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FSA fines Capital One £175,000 for PPI misselling

The FSA has fined Capital One Bank £175,000 for failing to have adequate systems and controls for selling PPI and failing to treat its customers fairly.
It is the eighth recent fine handed out by the regulator as it continues its crusade against misselling of the product.
It says the firm failed to ensure 50,000 customers received important information about the policy including exclusions although they did receive a policy summary.
Affected customers were unable to check what they were covered for or if the policy was right for them.
The FSA’s investigation, from January 2005 to April 2006, focused only on credit card PPI sales. In 2005 Capital One sold around 335,000 UK credit card PPI policies.
As part of a remedial programme introduced by the firm to address system and control issues customers who did not receive the policy document had the opportunity to be compensated, with costs of this programme estimated at £3m.
FSA director of enforcement Margaret Cole says: “We are determined to see much better practice in PPI. This fine and other recent PPI-related enforcement cases show we will crack down where firms fail to treat their customers fairly in this area.
It is unacceptable for people to be put at risk of buying unsuitable protection insurance through not being given the right information at the right time. And consumers should also remember that PPI on credit cards and loans is almost always optional and consider whether they need it before signing up.”


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