Packaged account mis-selling victims can claim compensation

opinions4u

There is, of course, mis-buying.

An example being a relative of mine.

She bought the packaged account for the holiday cover, home emergency cover and mobile phone cover (and aso to allow her to go overdrawn by a small amount without penalty). All the benefits were clearly listed - including breakdown cover that covers her in any vehicle.

She then bought a car and a car insurance policy. The insurers cross-sold her breakdown cover, even though she already had it. Why? Because she'd forgotten that it was included in her current account so never thought to mention it to the insurer.

The current account was sold properly.

The breakdown cover from the insurer was sold properly.

Yet she ends up with double cover.

Neither seller has mis-sold.

Then again, we have a mis-selling culture going on where people who have signed up for PPI in 3 different places, been provided with a breakdown of the costs, posted a policy booklet saying "this is what you're covered for" still turn round 3 years later and claim they never knew they had the cover.

I have sat in a room observing an insurance being sold to a customer, making notes about the style of selling and the key points being covered off. All in addition to the signatures, pieces of paper and posted booklets. Months later "nobody ever told me about this insurance". Provide the signatures, copy documents and evidence of observation to my complaints people - clearer proof of a good quality sale - and they just roll over and refund the customer because it's less hassle.

I'm not defending any bad sale of any product by a bank. Merely stating that most sales are clean.

Encouraging complaints with the promise of "compensation" will ensure the chancers get what they're after and the rest of the customer base ends up paying more for products in future.

HoneyAndLemon

Alpine_Star wrote: »

I see.

So if a typical packaged account is made up of say 6 different insurance policies (plus the account T&Cs themselves), you reckon that about two and a half minutes is enough to cover all the benefits,,eligibility, suitability and exclusions of each product for a particular customer to make a genuinely informed decision.

This is the problem isn't it?

These products are being flogged as current accounts with bells whereas they are in fact insurance products and as such should be sold and regulated as such.

In my view the FSA have correctly understood that bundling the products should not mean that the sales process should be bundled.

Where did I say I think two and half minutes is enough? While I think the scripts are long, I agreed with us having to read everything. It never ceased to amaze me that after 20 minutes of hearing scripting about insurances, constantly asking throughout if the customer understood and was okay with what was being said, that at the end of the call they would be like 'so what is this again'...or something similar which clearly showed they hadn't listened to a word I said.

The sales process, at least in the call centre, was very regulated, whether or not the same can be said in branch I don't know. But there were still a lot of customers that as opinions4u said 'mis-bought' the account, who will no doubt have their complaints upheld and given their money back.

2sides2everystory

opinions4u wrote: »

There is, of course, mis-buying.

An example being a relative of mine.

She bought the packaged account for the holiday cover, home emergency cover and mobile phone cover (and aso to allow her to go overdrawn by a small amount without penalty). All the benefits were clearly listed - including breakdown cover that covers her in any vehicle.

She then bought a car and a car insurance policy. The insurers cross-sold her breakdown cover, even though she already had it. Why? Because she'd forgotten that it was included in her current account so never thought to mention it to the insurer.

The current account was sold properly.

The breakdown cover from the insurer was sold properly.

Yet she ends up with double cover.

Neither seller has mis-sold.

Interesting example, O4U, but "any vehicle breakdown cover is a relatively expensive part of the current account package she bought from the bank yet she was still sold it when she did not have any need for it. Evidently a cost breakdown was missing from the original sale and that is most likely the reason why she remained unconscious of the potential benefit she'f already been paying for over some months/years and bought the same cover again from elsewhere when she became truly conscious of the need.

Then again, we have a mis-selling culture going on where people who have signed up for PPI in 3 different places, been provided with a breakdown of the costs, posted a policy booklet saying "this is what you're covered for" still turn round 3 years later and claim they never knew they had the cover.

Yes we certainly do and again that is because customers have come to the bank for one thing (a loan) and been sold something additional (and bloody expensive) which they can't possibly ever hold any complete understanding of because they are not you or me who are experts in PPI and have been for decades.

I have sat in a room observing an insurance being sold to a customer, making notes about the style of selling and the key points being covered off.

Tick box compliance you mean - actually the root of so much evil in financial services IMHO.

Tell me if I am right - and on those days when your sellers are selling without you at their shoulder ticking boxes and making notes, they still have to tick boxes themselves, don't they? How many photocopy the sheets with their own ticks already marked and initialled in order to save time? Maybe few now, because the tickbox palava is now often done onscreen. What's the minimum time it takes to sell one of these current account packages following the aide memoire onscreen, ticking boxes as you go?

All in addition to the signatures, pieces of paper and posted booklets. Months later "nobody ever told me about this insurance". Provide the signatures, copy documents and evidence of observation to my complaints people - clearer proof of a good quality sale - and they just roll over and refund the customer because it's less hassle.

This seriously makes me think you perhaps don't get what is happening, O4U. How many signatures per sale? How much reading and complete understanding must a customer do before they sign? How much time do you give them? As much as they want? Not good enough. You sound to me to be a cog in the wheel of pseudo compliance. The complaints people are a cog in the wheel of limited reality.

I'm not defending any bad sale of any product by a bank. Merely stating that most sales are clean.

Especially as you only sample a few and you follow a tick box form produced by your own organisation when you observe, then I am not sure you are in a position to make a useful judgement. You perhaps represent what we have got, and what we wish to improve.

Encouraging complaints with the promise of "compensation" will ensure the chancers get what they're after and the rest of the customer base ends up paying more for products in future.

Now that simply relates a paid view, doesn't it?

Alpine_Star

2sides2everystory wrote: »

Yes we certainly do and again that is because customers have come to the bank for one thing (a loan) and been sold something additional (and bloody expensive) which they can't possibly ever hold any complete understanding of because they are not you or me who are experts in PPI and have been for decades.

I agree. The FSA recognises that package accounts are flogged and not bought:

''Packaged bank accounts are generally sold rather than bought, i.e. consumers do not tend to proactively search for this type of account but are more likely to be upgraded by their existing bank or offered a packaged bank account rather than a fee-free account when opening a new current account.''

http://www.fsa.gov.uk/pubs/cp/cp11_20.pdf

''The number of consumers with a packaged bank account has increased significantly in the last few years. Mintel1 estimated 8.5m packaged bank accounts in 2009 and more recent information from firms indicates that in January 2010 there were approximately 10 million, i.e. around one in five of the UK adult population. The range of different packages available nearly doubled in the four years to 2010''

It whiffs of PPI to me.

opinions4u

2sides2everystory wrote: »

Tick box compliance you mean - actually the root of so much evil in financial services IMHO.

I think you have a genuine point.

It's what drives scripting as well. It doesn't drive the sales attitudes and behaviours, it merely ensures boxes are ticked.

Tell me if I am right - and on those days when your sellers are selling without you at their shoulder ticking boxes and making notes, they still have to tick boxes themselves, don't they?

A different set of boxes to tick in my day. So probably not.

How many photocopy the sheets with their own ticks already marked and initialled in order to save time?

I would guess none at all. Because such an approach would be likely to lead to strong discipliniary action.

This seriously makes me think you perhaps don't get what is happening, O4U.

Cheers .

How many signatures per sale? How much reading and complete understanding must a customer do before they sign? How much time do you give them? As much as they want? Not good enough. You sound to me to be a cog in the wheel of pseudo compliance. The complaints people are a cog in the wheel of limited reality.

I am no longer a cog in the wheel.

Especially as you only sample a few and you follow a tick box form produced by your own organisation when you observe, then I am not sure you are in a position to make a useful judgement. You perhaps represent what we have got, and what we wish to improve.

This all goes back to what the regulator wants to see as documentary evidence. If they demand certain things then that's what they'll get.

The FSA and all that have gone before have been horribly focused on production of paper. A complete lack of focus on the culture and spirit of sales.

Now that simply relates a paid view, doesn't it?

No.

ses6jwg

Santander have now removed the sale of packaged products from branches and they are only avaliable via telephone or online distribution.

dianasnan

very interested in this as my very elderly parents ended up with a packaged account by default when their existing account was withdrawn. Couldn't get them out of it until I could legally deal with their affairs. They were paying £12 a month for benefits which included travel and mobile phone insurance and they must have paid for at least 3 year unnecessary perks.

whiny

I wonder if my situation counts as mis-selling.

Several years ago I moved to England to attend university and was sold a student bank account charging £6 per month for 12 months. I was not informed of any free or cheaper alternatives. When the 12 months had lapsed, I visited the branch to request for a free current account. The bank manager said he was not able to complete my request without "proof of address", even though the bank was sending monthly statements to my address. As all my utility bills were included in my rent and my landlord was a private landlord, the bank manager mentioned my tenancy agreement would not be sufficient as proof of address.

It was not until last year that I visited another branch to try my luck, only to find out that there was no problem "upgrading" to a free account at all! This bank manager completed the request within 10 minutes!

I am starting to feel like I have been mis-sold an otherwise free/cheaper alternative. Thoughts?

Shirleyk

I was one of the victims of mis-selling when I was advised that I had to change my current account to a gold account. It was then upgraded to a platinum account without me being advised. I initially paid £8 for the gold account which was then increased to £10. My account was then upgraded to a platinum account without my consent and an increase to £15. It then increased in February 2007 to £25 which I thought was ridiculous so I went into the branch and was advised that I did not have to pay for a bank account.

To make matters worse, I did not require any of the benefits of either the gold or platinum accounts. I do not drive so don't requrie AA cover. I have pre-existing medical conditions so don't qualify for standard travel insurance. I have card protection through my Contents Insurance Provider so don't require Sentinel Cover. My mobile phone is provided by my work so I do not require that either. In reality the upgraded account was worthless and all it did was lose me money and help Lloyds TSB increase their profits.

I do not have bank statements going years back but I know I was paying from when these accounts were introduced. Can someone advise me when Lloyds TSB introduced these accounts please? Also, can someone give me the address to make a complaint to Lloyds TSB please?

Thank you in advance.

looktothefuture

I'd like to reclaim for the feepaying account I had with Natwest - how would I go about doing htis?