Credit cards Updated:
Millions of people who were mis-sold card protection and ID fraud products could be in line for hundreds of pounds in compensation.
The Financial Conduct Authority (FCA) announced today that it has reached an agreement with the insurance company - Card Protection Plan Limited (CPP) - and 13 banks that will pave the way for redress to be paid to customers who have been mis-sold the products, either through a bank or CPP directly, since January 2005.
Seven million customers were sold CPP's card and identity products, which cost each policy holder around £30 and £80 per year respectively.
Yet the FCA said in many of the cases, customers had been "given misleading and unclear information about the policies".
At the end of last year, the FCA's predecessor, the Financial Services Authority, fined CPP a record £10.5 million for its involvement in the mis-selling.
But the latest development has seen banks and credit card providers agree to provide up to £1.3 billion towards a new scheme that will be set up to provide compensation to those mis-sold the insurance.
The 13 banks and credit card providers that have agreed to be part of the scheme are:
The CPP insurance products were known by a number of names, depending on who was selling them, including:
However, The CPP compensation scheme must first be voted on by customers and approved by the High Court, and the FCA said it doesn't expect the first compensation payments to be made until next spring.
If you were sold one of the above mentioned products after January 2005 you could be in line to receive compensation.
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