£1.3 Billion Fund for Customers Affected by Mis-selling at York's CPP
8:21am 22nd August 2013
(Updated 9:18am 22nd August 2013)
£1.3 billion will be paid out to people affected by the mis-selling scandal at York based CPP.
Those who were mis-sold insurance protection against identity theft and card fraud can claim a full refund with 8% interest from the financial firm.
CPP was given a £10.5 million fine by financial regulators over the scandal in November 2012.
The financial firm had been overstating the risks of identity theft and failing to mention some cover was already provided by banks and so was not needed.
It comes after CPP arranged a new finance deal with creditors which means the fund can now be set up.
Martin Wheatley, chief executive of the Financial Conduct Authority, commented: "We have been encouraged that, working closely with the FCA and despite their different business needs, a large number of firms have voluntarily come together to create a redress scheme that will provide a fair outcome for customers. This kind of collaborative and responsible approach is a good example of how firms are taking more responsibility and helping - step by step - to rebuild trust.
"We believe this will be a good outcome for customers who may have been mis-sold the card and identity protection policies. Subject to CPP's customers approving the scheme, these policy holders will be able to claim a full refund of premiums with interest.
"Doing it this way means customers will get redress via a simple and standardised process, so we are encouraging customers to approve the Scheme when they receive their voting letters in the Autumn.
"To try and ensure that as many people as possible hear about the arrangements and that nobody misses out on redress, CPP, the banks and the credit card issuers have agreed to pay for a series of adverts in the national newspapers."
The affected customers and the High Court have to approve the plans but if they do it's expected compensation will start being paid in the Spring.
Customers will get letters from CPP from 29th August and can also (from 28th August) visit a special website or call 08000 83 43 93.
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