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MoJ warns claims firms over poor complaints handling

The Ministry of Justice is warning claims management companies they face enforcement action for failing to deal with complaints properly.

In its June newsletter to claims firms the MoJ, which regulates the sector, says it is in the process of issuing formal warnings to the worst offenders.

The newsletter defines a complaint as any expression of dissatisfaction, verbal or written, whether justified or not and insists all firms must have effective procedures in place to handle them.

It states: “It is apparent from the volume and nature of complaints that we are receiving that many businesses are failing to properly identify and/or handle complaints.

“We treat failures to comply with the Complaints Handling Rules 2006 seriously and are in the process of formally warning the worst offenders.

“Those who fail to implement changes to improve their complaints handling will be subject to further, formal enforcement action.”

The MoJ also highlighted an increase in claims firms targeting vulnerable customers and pledged firm action against businesses.

It also re-iterated its concern over the number of payment protection insurance mis-selling claims submitted where no policy had been sold.

It is currently auditing and investigating cases where businesses have unacceptably high level of ‘no PPI’ claims.


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  • D 8th June 2012 at 8:10 pm

    See what you mean James 943 the banks were allowed by the FSA to sell Billions in premiums of PPI that could never had paid out and often cost more than you can actually claim. O and it also paid virtually all the premiums in commission. The FSA took far to long to close the door.

    If the banks had done what they were told and write to all effected clients there would be no need for claims companies but they have not. When I was made redundant I found all my PPI policies would not and could not ever pay out. Strangely I put several claims through claims companies and the banks paid them all within a couple of months. The 2 claims I made myself are now 18 months old and are still not sorted. The problem was not made by clients / claims companies / most brokers it was made by banks and huge brokers that dealt in RTB and large numbers of remortgages.

  • James 8th June 2012 at 9:43 am

    Talk about ‘closing the stable door after the horse has bolted’.

  • Neil Walker 7th June 2012 at 2:33 pm

    So we have now had four complaints from the same CMC for the same client and he hasn’t got a PPI policy!

    We can only complain to the MOJ about these companies and hopefully get rid of them.

    I agree with the comments above in that it takes several hours of our time to defend a non claim as no PPI exists but we have to like it and lump it with no course of redress from the CMC who has basically attempted fraud!

  • Lucy 7th June 2012 at 2:06 pm

    John – sent all of your invalid complaints to The Claims Management Regulation Unit at the MOJ – address:

    57 – 60 High Street
    DE14 1JS

    We have had several complaints where no PPI was sold, several where we had in fact never had any dealing with the clients in question (we were mistaken for a company with a similar name). All from the same offending companies, template letters all alleging the exact same things.

    The MOJ have responded to each and every one of our complaints so it is worth persisiting and sending them on.
    I myself posed as a mystery shooper to one of the main offenders and low and behold my claim pack has arrived this morning and they have only sent ONE page of the consumer questionnaire – Section F the page where i put my signature and confirm that “I want to make a formal complaint about the sale of PPI and confirm all the information in this questionnaire is true and accurate to the best of my knowledge”
    However the offeding company have kept the remainder of the questionnaire I can only assume to complete themselves!

    The pack is now on its way to the MOJ with a full dialogue of the guy i spoke to, assuring me I HAD been mis-sold PPI and that I was due a very healthy sum of money!

  • Stuart Duncan 7th June 2012 at 1:42 pm

    It should be one false claim and out. This is criminal activity and the MoJ need to treat it seriously, not wag their fingers.

  • Bob Riach Riach Independent Financial Advisers 7th June 2012 at 1:39 pm

    About time.
    These claims are costing the financial industry a fortune in administration cost, usually for unfounded claims that are rejected.
    I completed a dummy application (I didn’t submit this to them) on a PPI claim Companies website all the answers given on the application are via drop down boxes, multiple choice that lead the client they don’t have an option to put their own answers.
    Do consumers not realise that the cost of dealing with these claims will eventually be passed on again to the consumers as the financial services companies will increase their cost to recoup their losses. So who wins in the end?
    I blame the FSA and The Ministry of Justice for allowing PPI claim Companies to trade

  • David Copeland 7th June 2012 at 1:36 pm

    I recently complained to the MOJ about a bogus PPI claim. The MOJ say they only regulate in England and Wales so because the client was based in Northern Ireland the MOJ have no jurisdiction. In other words claim manegemnt companies are not regulated for cases where the client is resident in Scotland and Northern Ireland

  • Bob Riach Riach Independent Financial Advisers 7th June 2012 at 1:32 pm

    I believe that many PPI complaints have been led by the No Win No Fee companies that are dealing on behalf of the clients.
    The first PPI claim I received was a year ago and I didn’t arrange PPI it was a life insurance policy it still took me several hours work to deal with the complaint.
    I had my second PPI claim last week. I completed a dummy application (I didn’t submit this to them) on the PPI claim Companies website all the answers given on the application are via drop down boxes, multiple choice that lead the client they don’t have an option to put their own answers.
    Al the facts given were completely untrue and it was obvious their answers had been prepopulated by the claim company.
    This claim took me about 4 hours to deal never mind the stress. I found an email on file from the client asking me to arrange the PPI cover so they will not win the claim. However I’m still at risk for £500 Financial Ombudsman fees if they dispute the claim rejection and take the case to the Financial Ombudsman (with no costs to them)
    I will now have to wait for about a months to see the outcome
    I blame the FSA and The Ministry of Justice for allowing PPI claim Companies to trade

  • William Kingsley 7th June 2012 at 1:31 pm

    Could this be the next mis-selling scandal I wonder? these firms cause so much trouble for small firms like us and the good news is that no complaints have been upheld against us which is what we expected anyway.

  • Justin Credible 7th June 2012 at 1:25 pm

    Too little, too late. The Ministry of ‘Justice’ has presided / regulated an industry where the level of attempted and real fraud is phenomenal – let us not lose sight of the fact that fraud is a criminal act. It has failed miserably and as per its regulatory cousins at the FSA is now spending even more money ‘investigating’ matters it should have prevented in the first place. A disgraceful shambles – but I doubt they care much, jobs and DB pensions for the boys and gals.

  • Dazed & Confused 7th June 2012 at 1:23 pm

    And I bet they are all quaking in their shoes at the prospect of a ‘formal warning’…

  • John 7th June 2012 at 1:18 pm

    Does anyone know the easiest way to pass details to the MOJ where a claim has been received from a claims’ firm but no PPI was sold by us?