FCA is consulting on new guidance on handling complaints about regular premium PPI, to deal with an uncertainty which has arisen since the post-Plevin rules. The Plevin judgment and the rules that followed it say that if a lender fails to disclose at point of sale a large commission payable out of the PPI premium then this may make the lender’s relationship with the customer unfair under the CCA.
FCA has become aware that some firms are rejecting complaints involving undisclosed commission for restricted credit PPI told before 6 April 2007 on the basis that complaints relating to restricted credit that took place before then are not covered by FCA’s complaints handling rules. FCA now proposes to clarify that firms should assess commission disclosure not only at the point of sale but on an ongoing basis, so that they should also consider recurring non-disclosures, under general complaints handling rules. So any recurring non-disclosures that occurred after April 2007 will fall within the complaint handling rules, even where the PPI was sold and credit relationship entered into before that date (so long as the credit agreement is within scope of s140A CCA)
FCA asks for comments by 4 September and hopes to issue guidance to take immediate effect in late Autumn. It will need to make the guidance quickly so that consumers who have had a complaint rejected will have time to consider whether to make a new complaint before the August 2019 deadline.