In the hope of writing off loans, many people are being exploited by case management companies, says Rodney Gardner
The Competition Commission (CC) has recently announced a ban on the sale of payment protection policies, at the point of sale, such requirements to be implemented by next year. Several banks have already agreed voluntarily to impose a ban now and it is thus apposite to consider the law and practice that is presently evolving with regard to such claims.
Claims management companies (CMCs) have been seeking refunds from banks for some time now on behalf of borrowers who have been sold single premium policies when applying for both secured and unsecured loans, many of the people affected being within the lower socio-economic groupings. The CC has found that policies being sold are uncompetitive, and CMCs have in the past had some success in gaining refunds on the grounds of unsuitability and/or ineligibility of the debtor.
The only way a CMC can advance a client’s claim, which is rejected, is to refer it to the Financial Ombudsman Service (FOS), which is a lengthy
