Jan
10
2011
Company umbrella contractors told 'FOS could suffer after PPI review'
Posted by Daniel Frost
Umbrella company contractors have been told that the result of a judicial review concerning payment protection insurance (PPI) complaints could see the Financial Ombudsman Service (FOS) suffering.
The mediator revealed that if banks block complaints into mis-sold PPI, then it may have to exhaust its cash reserves within six weeks.
A judicial review was called by the British Bankers' Association, which aims to look at the FOS' handling of PPI complaints, as well as the role which the Financial Services Authority (FSA) has on this controversial matter.
However, if the verdict falls against the favour of the FOS, then it may have to up its reserves from five per cent of its expenditure to 25 per cent, with funds needed to be sought in order to achieve this.
The FOS explained: "If financial businesses were to decide to suspend cooperation on PPI cases as a result of the legal action, our loss of income from case fees in just one month could lead to an operating monthly deficit of up to £4 million."
Recently, PPI.co.uk noted that mis-sold PPI could be the worst financial scandal the UK has ever seen.
Umbrella company contractors have been told that the result of a judicial review concerning payment protection insurance (PPI) complaints could see the Financial Ombudsman Service (FOS) suffering.
The mediator revealed that if banks block complaints into mis-sold PPI, then it may have to exhaust its cash reserves within six weeks.
A judicial review was called by the British Bankers' Association, which aims to look at the FOS' handling of PPI complaints, as well as the role which the Financial Services Authority (FSA) has on this controversial matter.
However, if the verdict falls against the favour of the FOS, then it may have to up its reserves from five per cent of its expenditure to 25 per cent, with funds needed to be sought in order to achieve this.
The FOS explained: "If financial businesses were to decide to suspend cooperation on PPI cases as a result of the legal action, our loss of income from case fees in just one month could lead to an operating monthly deficit of up to £4 million."
Recently, PPI.co.uk noted that mis-sold PPI could be the worst financial scandal the UK has ever seen.