With the Financial Services Authority (FSA) receiving complaints against high street banks at an all-time high, Barclays Bank tops the list at an astonishing 250,000 new disputes being recorded during the first half of 2011 alone.
At the moment, the FSA is receiving more than 10,000 complaints a day pertaining to high street banks, a statistic that has risen by approximately 3% within the last 12 months, primarily due to the widespread mis-selling of payment protection insurance.
Barclays is not alone in receiving large numbers of customer complaints this year, with Lloyds TSB having about 180,000 complaints and Santander with nearly 170,000 complaints. According to the FSA and Barclays representatives, a large percentage of the complaints lodged within the past year have been related to payment protection insurance (PPI).
Overall, the FSA have received more than 1.8 million bank complaints this year, with more than 500,000 of those complaints pertaining to mis-sold PPI. Payment protection insurance, which may go down in history as one of the worst insurance mis-selling scandals in the United Kingdom, is supposed to provide cover in the event that a cardholder or borrower is unable to work due to unexpected illness, injury, or unjust termination.
Unfortunately, the majority of policyholders were never eligible for a PPI policy to begin with, causing a massive number of lawsuits to be filed against lenders and card companies that sold PPI policies to ineligible applicants. Now that the FSA has ruled that PPI mis-selling claims can be reviewed in a retrospective manner, more than 3 million people in the United Kingdom are eligible for compensation, with the total monetary sum involved reaching more than £9 billion in claims.
With everyone that has been mis-sold a policy during the last six years being eligible for a PPI reclaim, it is not surprising that such a massive number of complaints have been filed against high street banks like Barclays.
