The Competition Markets Authority (“CMA“) has taken action against Cardif Pinnacle, and has written to Nationwide and Lloyds, after they failed to provide accurate annual Payment Protection Insurance (“PPI“) reminders.
CMA has issued Cardiff Pinnacle with legally binding directions ordering it to appoint an independent body to audit its PPI processes and put in place measures to ensure that similar incidents do not reoccur.
By way of background, all PPI providers are subject to a CMA Order which requires them to send customers annual reminders that set out how much they have paid for their policy and the type of cover they have, and remind them of their right to cancel.
CMA says that since 2012, Cardif Pinnacle has sent over 14,800 inaccurate reminders to 7,400 customers. The company is now sending apology letters to those affected.
CMA has also written publicly to Lloyds and Nationwide, after both breached the Order again. Lloyds breach the CMA’s Order 18 times over an 8-year period by failing to send reminders, or sending reminders containing inaccurate information, to more than 10,000 customers. Nationwide failed to provide annual reminders to over 3,000 customers during a 4-month period.
Lloyds is in the process of refunding those who would have cancelled their policy had they received an accurate reminder, and has paid out £96,000 to date. Nationwide is contacting customers and is offering to refund their PPI payments for 2020 should they wish to cancel their policy. Those refunded will also receive 8% compensatory interest on the money they paid into their policy.
CMA cannot currently impose financial penalties on businesses for breaches of this kind, but it has called for the power to do so.