Lloyds failed to give customers correct information about PPI, says watchdog
Lloyds Banking Group has failed to give thousands of customers the correct information about their PPI following previous similar incidents, the competition watchdog has said.
The Competition and Markets Authority (CMA) has issued legal directions to Lloyds over “serious” breaches of the Payment Protection Insurance Market Investigation Order 2011.
It said Lloyds had failed to send annual PPI reviews and provided incorrect data to its customers.
The CMA said that, following a series of breaches, it is now requiring legal assurances from Lloyds that it has measures in place to prevent similar breaches from happening again.
The watchdog said it is not the first time Lloyds has breached the PPI order, having reported six breaches in 2016 for failing to provide customers with correct data and annual reminders.
The CMA acted against Lloyds after IT problems meant around 14,000 customers did not receive a reminder between 2012 and 2018.
Lloyds also provided incorrect information on PPI premiums in annual reviews sent to 2,884 customers.
Annual reviews remind customers they still have a policy as well as how much it is costing them each year and their right to cancel or switch.
The legal directions can be enforced by a court to ensure Lloyds complies.
Lloyds has started sending apology letters to affected customers.
The firm said customers were charged the correct PPI premiums and any claims submitted have been paid in line with the policy terms and conditions.
A Lloyds Banking Group spokesman said: “We are writing to a small number of credit card customers whom we identified as having not received their annual PPI statements.
“Whilst we have resolved the cause of the issue, we are extremely sorry for any inconvenience caused. We will be contacting all affected customers.”
The CMA’s action comes after an investigation into PPI by the Competition Commission which ended in 2011.
One of the measures introduced was for customers to receive an annual review from their provider, setting out clearly how much they had paid in and their right to cancel the policy.
Adam Land, the CMA’s senior director of remedies, business and financial analysis, said: “We are disappointed that Lloyds has again failed to provide these important reminders or provide accurate data to its customers.
“These are serious breaches.”
Barclays recently apologised after giving wrong information to some people trying to check whether they have had PPI.
It is thought that tens of thousands of people were affected by that incident.
Barclays previously said a review had found “a very small percentage” of customers were given wrong information when contacting it via a claims management company to find out whether they had PPI.