FSA issues fine following sale of unsecured loan insurance - Loans - News - Moneyfacts


FSA issues fine following sale of unsecured loan insurance

FSA issues fine following sale of unsecured loan insurance

Category: Loans

Updated: 31/10/2008
First Published: 09/10/2008

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Alliance & Leicester (A&L) has been fined following an investigation into the sale of insurance alongside unsecured loans.

The Financial Services Authority found that those selling the policies failed to give customers important details, such as the fact that the insurance is optional.

Staff were also found to have put pressure on customers when the inclusion of payment protection insurance (PPI) - which is offered to protect against an inability to pay off loans - was queried.

A&L will have to pay a £7 million fine as a result of the findings.

Director of enforcement at the FSA Margaret Cole remarked: "The failings at A&L are the most serious we have found ... it is very disappointing that after three years of regulation we are still finding serious problems in PPI sales."

Chief executive of A&L David Bennett apologised for the shortcomings, adding that the company would be writing to every customer to explain.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Get a record low rate loan - if you qualify

Competition in the personal loans market is as hot as ever, so much so that one loan provider has slashed rates to the lowest on record – but only to those who fit the bill. The shopping bill, that is…

Competition returns to loans, but stalls in cards

Our recent figures reveal a mixed picture in terms of unsecured lending, as while competition appears to have returned to the loans market, it’s notably slowed in the credit card sector.

How to improve your credit score

Are you thinking about applying for credit? If so, you need to make sure your credit score is in order.