There have been several cases of mis-sold PPI since the PPI scam unfolded. The number of claims has been increasing so rapidly that the banks and financial institutions are not able to function smoothly. This has resulted in the process getting much slower and more complicated. Hence, more and more people have been taking help of claim companies which help them to get claims faster. This reduces the burden off the affected buyers as all the work is done by the claim companies.
However, not all the companies are efficient and ethical enough to work. While there are certain companies which are fully dedicated and helpful to the buyers, there are also certain companies which are fraudsters themselves. This is why a step was taken by the Government to pass a bill making regulations to the way these companies function. This is the Financial Guidance and Claims Bill, which would look into the matters of claims handling and make sure that the mis-sold customers are treated in a fair and just manner. The bill is currently in the House of Lords at the Committee stage. One of the major aims of this bill is to transfer the responsibility of making regulations from the claim companies to the Financial Conduct Authority (FCA).
Following are the relevant clauses of the bill:
- Making appropriate amendments to the Financial Services and Market Act 2000 in order to let the FCA have the powers to regulate the claim companies.
- Giving powers to the FCA to impose a cap on the amount charged as a fee by claim companies for their services.
- Including a power for the Ministry of Justice to put a transfer scheme in place for the assets/liabilities of the Claims Management Regulation Unit and the staff
- Shifting the power of handling consumer complaints against the claim companies from the Ombudsman to the FCA
Though the bill is expected to improve the condition of the customers, it is likely to take sufficient time before it is finally implemented. The authorities are not looking to rush into these matters and want to take slow steps in making new regulations. Until that time, the claim management companies will continue to function as they already are. However, this is not good news for people who were mis-sold PPI, as the deadline for PPI claims has been recently fixed to 29th August 2019. This would make the consumers experience more approaches from the claim companies about possible historic policies and claims. This is because the claim companies will have to rush in order to take care of all the claims before the deadline approaches.