PPI Claim News - 7/8/2012
PPI claims management firms 'will not have to pay fees to ombudsman'
Payment protection insurance (PPI) claims management companies will not have to pay fees or levies, the Financial Ombudsman Service has stated.
In its report, entitled Charging for our work: modernising our case fee arrangements from 2013, the organisation said this would "not be the right way forward".
It noted that it has considered these proposals "carefully", noting it understands why some people might think PPI claims firms should contribute towards the ombudsman's costs.
However, the group pointed out that consumers would end up paying these charges themselves.
Furthermore, it claimed the problems raised in consultations could be better addressed by increasing regulation of the claims management industry, as well as by preventing "mass complaints at source".
The ombudsman noted that its funding model finds it difficult to deal with the large number of people who contact it following the PPI claims scandal and other problems in the financial sector.
It regulates approximately 30,000 firms regulated by the Financial Services Authority and around 80,000 organisations that the Office of Fair Trading has issued consumer credit licenses to.
Having worked in the city for 19 years, John's main focus is interest rates and corporate finance.
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