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FSA fines Co-op Bank for freezing PPI complaints process

FSA fines Co-op Bank for freezing PPI complaints process

The Financial Services Authority (FSA) has handed a £113,000 fine to The Co-operative Bank over unfairly dealing with payment protection insurance complaints.

The regulator said the Co-op put a hold on many customers’ PPI complaints, when it could have moved forward with the claims.

The FSA added that it had written to the industry making clear that claims should progress normally while the British Bankers Association was unsuccessfully challenging the regulator’s PPI complaints procedure in the High Court.

‘The FSA made it clear that firms must continue to process complaints where possible during the judicial review and we warned that enforcement action could be taken if this was not done, said Tracey McDermott, director of enforecement and financial crime at the FSA.

‘Despite this warning Co-op put in place a policy that was likely to lead to complaints not being dealt with properly during the legal proceedings.’

She added that while customers saw no financial loss from having their complaint put on ice, the delays were still irksome for those affected by the PPI misspelling.

‘We will continue to take action where we find PPI customers have not been treated fairly.’

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