As the PPI complaints deadline has passed, many have missed the opportunity to complain to their loan provider. While the media concentrated on the supposed last dash to gain compensation, our recent landmark court victory could mean that the PPI claims process could continue in court beyond the August 29th deadline. So, what is the Akhtar vs Welcome Financial case and how could this impact your future claim?
The Akhtar case
Azra Akhtar’s case against Welcome Financial was to reclaim money for a mis-sold PPI policy and the interest paid on that policy. Using precedents from previous cases including Plevin and Doran, the court also ruled in Miss Akhtar’s favour that any undisclosed excessive commissions constituted an unfair relationship between her and her lender.
In this landmark case, however, the court went one step further.
The Plevin Rule and the FCA
The Plevin Rule was introduced after Susan Plevin took action against Paragon Finance in 2014.
As a result, in March 2017 the FCA changed the guidance and rules required on complaints about PPI. It ruled that any undisclosed commission amount over 50 percent on a PPI policy constitutes an unfair relationship between consumer and lender.
That meant consumers were only compensated with the percentage of commission over 50 per cent (plus interest).
However, in the Ahktar case, the court ruled that Miss Akhtar should receive the full amount of PPI premium and the full broker commission paid by the lender to the broker to arrange the loan and the PPI.
The court’s ruling effectively sets a precedent that any amount of undisclosed commission paid to the lender and broker on PPI and arranging the loan by a broker constitutes an unfair relationship.
What this meant for Miss Akhtar
The undisclosed commission on Azra Akhtar’s policy was 85 per cent; almost as much as the policy itself. She only expected to receive 35 per cent over the 50 per cent cap as per the Plevin Rule.
However, as a result of the court’s ruling, she received the full PPI premium amount and commissions paid to the broker.
Miss Akhtar eventually claimed back £3,594.71 – almost double the average £2,004 PPI pay-out.
This was a landmark victory for both Miss Akhtar and APJ Solicitors, but it could have further repercussions for PPI claims before and after the 29th August deadline.
What this means for PPI payouts
In the long term, this could mean the PPI complaints process continues into the courts beyond the deadline. The Akhtar ruling certainly opens up fresh complaint opportunities for consumers looking to seek the full amount of undisclosed commission on their PPI policies. Find out more about what happens after the PPI deadline here.
If you think you may have been previously mis-sold a PPI policy, please speak to one of our expert solicitors to see whether you have a claim.