PPI claims firms face scrutiny in 2007

Claims companies cashing in on the mis-selling of payment protection insurance have been warned they are on the radar screen of the Claims Standards Council.

Damning reports have been issued recently by the Office of Fair Trading and the Financial Services Authority over the mis-selling of PPI.

Andy Wigmore, policy adviser at the CSC, says there are now 20 specialist PPI claims firms in the market.

He says: “We’re concerned about many of these companies but we can’t do much until the regulation of claims firms comes into place early next year.

“We have a number of PPI companies on our radar, particular as a lot of them are newly formed.”

Brunel Franklin, which is pushing for standards to be raised among claims firms, recently established a specialist no win, no fee PPI claims service called Conkers.com.

Ian Alison, corporate relations director for Brunel, says its research shows the PPI market is potentially worth 10bn and as many as 30 million policyholders may have claims.

He adds: “The terms and conditions of PPI are incredibly onerous and most consumers will find the paperwork unmanageable.”

But Rob Griffiths, associate director at the Association of Mortgage Intermediaries, says: “If a client has a complaint they should first go to the firm they want to complain about.”