The FSA should name the firms it has identified as failing to meet its requirements for selling Payment Protection Insurance (PPI), says Moneyfacts.co.uk
The firm says failing to take this stance means consumers are still vulnerable to being sold “unsuitable, overpriced and inflexible products via a flawed sales process”.
Earlier today the FSA pledged to step up its campaign against firms failing to treat its customers fairly over PPI sales after publishing its latest review on the issue.
The regulator said it would increase fines for offenders as well as carry out some more mystery shopping exercises.
It pointed out it has already taken action against 18 firms over PPI sales practices in the past and will now add another four to that list. In addition, it says a further 20 cases are set to be investigated.
However, every firm mentioned remains nameless and Moneyfacts says this is not helping the FSA’s cause.
“We have all been aware of the shortcomings of PPI products and the associated sales process for longer than we care to remember and are disappointed that it appears that we are really still no further forward,” spokesman Andrew Hagger says.
“If the FSA is aware of the providers that are still failing to treat customers fairly, then why is it not sending a warning message to the rest of the industry by naming the offenders it has identified.
“By entering into a further period of mystery shopping, it means that consumers are still potentially going to be sold unsuitable, overpriced and inflexible products via a flawed sales process.
“Consumers have little faith in the financial services industry as shown by the reaction to the Northern Rock incident, so this lack of action is going to do little to improve the customer perception of our industry.
“It is inevitable that changes need to happen sooner rather than later, so why is the FSA not being more forceful, rather than allowing the institutions to continue to rake in vast profits from the sale of PPI.”
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