Over the next few weeks more than 7m people will be receiving letters telling them that they have been victims of a major miss-selling scandal from the biggest banks is UK. Sound familiar? The dust is only just staring to settle on the PPI malarkey now another one has reared its ugly head. Every person affected will be receiving a letter telling them how to claim up to £300 in compensation and this money is being distributed according to the City Regulator’s instructions a another widespread mis-selling debacle comes to light.
It seems hard to believe that once more banks have been caught out in the act of abusing the trust of consumers by selling a worthless and inappropriate product to seemingly anyone they could con into taking it. This time around it is identity and credit card insurance. The cover in question was provided by a company known as CPP, but it was frequently repackaged by the banks and sold under such names as Barclays Cardholder Protection, NatWest Card Protection and M&S Money Cardsafe.
These products were typically sold when a consumer took out a new credit or debit card. These cards were delivered with a sticker on the front urging the customer to ring CPP in order to activate the card. Once on the phone, the salesperson on the other end greatly exaggerated big the threat of fraud really was and cajoled the customer to pay as much as £84 a year for this useless protection policy.
The reason they are practically worthless is simple; if your bank account was hit by fraud or emptied you are automatically entitled to full compensation at no cost, thus, there is absolutely no need for any kind of extra insurance. In total, around £1.3bn will be paid out by 13 well known institutions including HSBC, Barclays, Santander, Lloyds and NatWest.