The Financial Services Compensation Scheme (FSCS) reported an increase in financial mis-selling payouts last year. This suggests that the scandal is far from over.
The scheme paid out to more than 69,000 investors in the 2017/18 tax year. Claims were up from the previous year, with payouts rising from £375m to £405m.
Pension mis-selling payouts
Around a fifth of the claims made were related to pensions advice. Self-invested personal pension (Sipp) schemes such as Ethical Forestry, Harlequin Properties and StoreFirst were mis-sold to investors. Many investors lost their life savings in fraudulent or unsuitable schemes. We took legal action on their behalf.
We’re currently dealing with a number of Sipp providers to ensure our clients receive compensation for financial mis-selling. We recently launched the biggest ever case made against Liberty Sipp. Click here to read more on the case.
PPI mis-selling payouts
Payment protection insurance (PPI) is still one of the most common types of complaint made to the FSCS. The deadline is approaching and an advertising campaign urging consumers to make a complaint is running. This resulted in the FSCS receiving more than 7,200 PPI claims.
Many of these consumers claim citing the Plevin rule. This is a ruling that states if the broker charged commission of more than 50 per cent, it amounts to an unfair relationship.
However, a recent ruling may urge people to make their claim. Paragon v Doran resulted in Doran being awarded the full 76 per cent of the commission paid to the broker. Paragon expected to return the 26 per cent above the unfair level. However, the judge gave a much harsher punishment than anticipated for the mis-selling case.
This higher payout is a larger incentive for people to claim. As a result, we may see a large influx of PPI claims under the Plevin rule before August 2019.
If you believe you have been mis-sold an investment or financial product, get in touch today. Our team of litigators can offer support and advice with your complaint.