Banks to pay back two million conned by useless card insurance
Thursday, 08 20 2015, Category: Insurance and Reinsurance, Country: United Kingdom
Around two million people duped into buying worthless insurance by their bank are in line for up to £270 compensation each. Britain’s biggest lenders routinely sold insurance that was designed to protect customers against fraudulent transactions made on their cards. But the insurance – which typically cost £25 a year – was useless because banks are legally obliged to refund those fraudulent payments anyway.
City watchdog the Financial Conduct Authority said customers would start receiving claims forms later this month with the first pay-outs made in late September.
They could receive as much as £270 but will have to claim before March 18 next year or miss out.
Campaigners criticized the deadline and said customers have not been given long enough.
Eleven banks and financial companies were involved in the scam, including Barclays, HSBC, Lloyds, Santander and Royal Bank of Scotland.
Although on a much smaller scale, the case has echoes of the payment protection insurance scandal that has lumbered the UK’s biggest banks with a compensation bill of almost £27billion.
Source: Daily Mail