Bank’s customers urged to fight for compensation

Lloyds, Trinity Road, Halifax
Lloyds, Trinity Road, Halifax

Lloyds customers who have had their payment protection insurance claims rejected are being urged to fight on for compensation after an undercover investigation into the bank found evidence of failures in processing complaints.

A journalist working for The Times was told that some bank salesmen had faked information on agreements and that complaints handlers should effectively turn a blind eye to the risk of fraud.

The majority of customers would give up chasing a PPI complaint if the bank rejected it the first time around, the reporter was told.

As Lloyds admitted there had been “issues” at an outsourced complaints handling centre, Martin Lewis, founder of website MoneySavingExpert, said customers who have had their PPI compensation claims turned down by the bank should either take their complaint to the free Financial Ombudsman Service (FOS), which resolves disputes between consumers and financial firms, or re-submit their grievance to the bank.

Mr Lewis said: “If Lloyds have turned you down, you need to fight if you feel you have been mis-sold, certainly ignore a Lloyds rejection.

“A rejection is being rejected by the ombudsman, it is not being rejected by the bank – that is part of the dance.”

Mr Lewis said he had received several tweets from Lloyds customers saying their claims had initially been rejected by the bank and they had later gone on to win compensation.

In one message, a claimant said they had ended up with a payout of more than £4,000.

Yesterday’s disclosures came as the new regulator – the Financial Conduct Authority (FCA) – prepares to release a report on PPI firms’ complaint-handling procedures that is due to be published later this summer.

The FCA said it is aware of the issues raised and it has been working with Lloyds to ensure they are resolved.

The Times’ investigation centred around contractors employed at the group’s largest PPI complaint handling centre at Royal Mint Court in London.

Lloyds Banking Group said that last month it terminated its contract with Deloitte, which operated the complaint handling centre on its behalf.