The FCA’s View on Plevin and PPI Direct Redress
Susan Plevin’s case against Paragon Personal Finance exploded in the news following the Supreme Court’s landmark ruling on her case.
Plevin won her PPI refunds after the SC declared null the broker-consumer relationship she had with Paragon Personal Finance.
Local newspapers and market analysts predicted the ruling would make its way into the watchdog’s PPI rules list, making way for millions more PPI direct redress in the next few months.
But did the FCA really say that?
Who Gets PPI Refunds?
The Supreme Court ruled in favour of Plevin under section 140A of the Consumer Credit Act 1974 wherein the broker-consumer relationship of Plevin and her broker is declared unfair on condition that the broker did not disclose his commission, which is above the 50 per cent of the original single premium PPI price.
The Supreme Court ruled that any commission above 50 per cent of the product’s original price brokers should disclose the amount to consumers.
Implications on Rules
The FCA did not say it will inculcate the Supreme Court decision immediately. It did say it would launch a consultation by the end of the year and will consider proposed rules and guidance concerning the fair handling of claims for PPI refunds in cases customers paid undisclosed commission to their brokers.
Analysts speculate the new rules to require the firm to pay redress in reference to the amount where the commission paid exceeds 50 per cent of the premium paid.