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Ppi Another Potential Boost To Gdp, The Gift That Keeps Giving

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http://www.dailymail.co.uk/news/article-3191237/UK-bank-customers-line-33BILLION-windfall-landmark-court-ruling-exposed-new-finance-product-mis-selling-scandal.html

  • UK's top four banks bracing themselves for huge hit following court ruling
  • In the case, it was decided it was unfair if PPI customers were unaware how much commission their broker was earning
  • If this is applied to all financial products, it could be 'apocalyptic' for banks
  • UK lenders have already paid £30billion compensation over PPI mis-selling

..........The landmark ruling was made in favour of 59-year-old widowed college lecturer Susan Plevin, who took out a loan and PPI policy in 2006.

She complained to the court that at the time, she wasn't made aware that more than 70 per cent of the commission she paid ended up in the pocket of her lender - Paragon personal Finance - and a broker.

..........

The result could mean that if a PPI policy was otherwise sound the seller could still be made to repay the customer if it had received a large, undisclosed commission.

One senior official at a British bank told The Sunday Times that the ruling could be 'apocalyptic' if applied to any financial product where commission levels were not disclosed to the customer.

They said some fear the FCA will choose the 'nuclear option'.

If this is the case, the industry could be whacked with a £33billion bill, according to a recent study from Autonomous Research.

No doubt George will be pushing for the nuclear option as this could boost the spending power of the consumer and be recycled back into new loans.

Win win.

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bother - didn't fall for the 'ppi hard sell' - so I have missed out again. :huh:

I do feel that those who were sensible and read the small print and did not believe the salesman should get SOMETHING.

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why would the 'commission' have to be disclosed to the customer unless the customer was paying it? - where is the monetary loss?

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PPI is all about giving something back.....an efficient way of getting the QE money back into the economy......

helicopter-money40.jpg

Not sure I'd agree with it being an efficient way, because it's only a windfall to those who took out PPI. Although perhaps the feeling is if they were stupid enough to fall for the PPI hard sell they'll be mugs again with the money and take out a new loan?

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Not sure I'd agree with it being an efficient way, because it's only a windfall to those who took out PPI. Although perhaps the feeling is if they were stupid enough to fall for the PPI hard sell they'll be mugs again with the money and take out a new loan?

The money is going back to those that paid a high price for it....and a few middlemen that have made a fortune from it.....loans will always be good for the economy, its the price of them and the will and ability to pay that counts........give an expensive loan to someone who has nothing to lose and the chances are you will lose it...else insure it. ;)

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Could explain why he is quickly offloading RBS.

All things being equal, the greater the stealth fiscal stimulus Osborne extracts from the Big Four the greater the number of job losses they're likely to incur. Easy to imagine how that would have had a bearing on a decision to offload RBS.

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bother - didn't fall for the 'ppi hard sell' - so I have missed out again. :huh:

I do feel that those who were sensible and read the small print and did not believe the salesman should get SOMETHING.

Recent history is against you.

To coin a phrase, Caveat Lector nota parva.

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Not sure I'd agree with it being an efficient way, because it's only a windfall to those who took out PPI. Although perhaps the feeling is if they were stupid enough to fall for the PPI hard sell they'll be mugs again with the money and take out a new loan?

That's exactly my interpretation of it. No point giving money to people who are going to pay down debt or stick it in a savings account, far better to give it to people who will use it to borrow even more.

Edit - if you're the UK Govt, that is, not me.

Edited by Fully Detached

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PPI is all about giving something back.....an efficient way of getting the QE money back into the economy......

helicopter-money40.jpg

+1

Indeed - and the possible judgement on PPI (see OP's post) comes when Corbyn is suggesting giving free money directly to people.

The PPI route means that "they" will still get the money first and can thus outbid everyone else whereas that's not the case with free money handed out directly to people.

In fact to some extent the boot would be on the other foot - and that's why they're starting to use words like illiterate and populist proposing dangerous incendiary nonsense for a policy not much different to their very own (see the Halligan On Zero Interest Rates thread).

Edited by billybong

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The only way to stop this is to stop the banks (etc) lending any money.

Save.

But not with a bank!

If you don't want to feed the beast (I don't) you need to do something else with your wonga.

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bother - didn't fall for the 'ppi hard sell' - so I have missed out again. :huh:

I do feel that those who were sensible and read the small print and did not believe the salesman should get SOMETHING.

The new wording of the very latest PPI call centre phone calls say that you can claim even if you have no policy details - like it'll still go through. A memory issue? The refund is claimed to be automatic so it's quite possible the full helicopter money moment has arrived or is imminent but it's still through the banking system and not quite like Corbyn seems to be suggesting.

It might be worth waiting to see exactly which policies the latest ruling apples to (then applying or not applying). The money is probably being created out of thin air/printed/Quantitative Eased etc at this very moment.

Edited by billybong

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