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Release Date: 5th June 2015

To access the original FCA document, click here.


The FCA fined Lloyds £117 million for failing to handle Payment Protection Insurance (PPI) complaints fairly between March 2012 and May 2013. Lloyds assessed over 2.3 million PPI policies and unfairly rejected 37% of complaints. The bank issued guidance to complaint handlers, known as the Overriding Principle, which assumed the PPI sales processes were compliant and robust unless proven otherwise, leading to biassed assessments. Complaint handlers were not informed of known failings in the PPI sales process, leading to unfair dismissal of complaints without thorough investigation. Additionally, Lloyds did not always contact customers to obtain their account of the sale, resulting in many complaints being unjustly rejected.

Key Takeaways for Other Firms:

By adhering to these principles, firms can maintain customer trust, ensure fair treatment, and avoid substantial regulatory penalties.

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