Five motor retailers have been fined more than £175,000 in total by the Financial Services Authority for serious breaches relating to sales of payment protection insurance (PPI).
GK Group Limited, George White Motors Limited, Ringways Garages (Leeds) Limited, Ringways Garages (Doncaster) Limited and Park’s of Hamilton (Holdings) Limited sold PPI alongside loans for a car or motorbike.
Following investigations at each business, the FSA discovered a number of major issues:
Failing to gather enough information about each customer (including pre-existing medical conditions, existing insurance cover and benefits received from employers), creating the unacceptable risk of unsuitable sales of PPI;
Not monitoring the quality of the advice given by sales staff and to ensure that appropriate sales processes were followed;
And one dealer did not adequately assess whether customers were eligible to claim for benefits from the PPI policies they sold, and another did not assess complaints properly.
Margaret Cole, FSA Director of Enforcement, said: “Motor retailers that sell PPI have to meet the same standards as the rest of the financial services industry.
“All firms selling PPI must treat their customers fairly, including taking proper steps to make sure sales are suitable and customers are eligible to claim on the policy – PPI remains a top priority for the FSA in 2008 and beyond.
“Where we discover PPI failings, we will not hesitate to take tough action and impose higher penalties.”