Time running out to claim for mis-sold CPP card protection

CPP protection mis-selling

Back in 2012 CPP was fined £10.5 million, by the FCA’s predecessor the Financial Services Authority for the widespread mis-selling of its card protection and identity theft insurance plans.

Between January 2005 and March 2011 4.4 million policies were sold while a further 18.7 million policies were renewed.

While CPP sold these products direct, it also had help from high street banks and credit card firms. New debit and credit cards were issued with stickers which had a number to call to ‘activate’ the card. But this went straight through to a CPP sales team.

Many were persuaded to spend around £30 a year to insure their card against fraud, protection already offered by banks and credit card providers free of charge.

CPP’s identity theft protection policy was sold for around £80, but the FSA ruled it ‘greatly exaggerated’ the risks during the sales process.

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Compensation agreement

In August 2013 a £1.3 billion compensation scheme was agreed by CPP along with the 13 banks and credit card firms involved including:

• Bank of Scotland Plc, Barclays Bank Plc
• Canada Square Operations Limited (formerly Egg Banking Plc)
• Capital One (Europe) Plc
• Clydesdale Bank Plc
• Home Retail Group Insurance Services Limited (which owns brands including Argos)
• HSBC Bank Plc
• MBNA Limited
• Morgan Stanley Bank International Limited
• Nationwide Building Society
• Santander UK Plc
• Royal Bank of Scotland Plc
• Tesco Personal Finance Plc

And the insurance products were known by a number of names, depending on who was selling them. Here’s a full list of those names:

• Card Guard (offered by HSBC)
• Card Safe (offered by M&S Money)
• Barclaycard Card Protection
• Barclays Cardholder Protection
• NatWest Card Protection
• Egg Emergency Cover
• Card Protection, Card Protection Plus and Commercial Card Protection (which were sold by CPP and a number of its business partners)

Victims were invited to vote on how they wanted to receive compensation and many agreed on a claim form with a deadline of 30th August 2014. The 30th August cut-off date was a feature of the scheme that was approved by the High Court and also CPP customers in a vote last year.

The regulator told us it’s up to the CPP scheme administrator – Ernst and Young – to decide whether or not to extend the 30th August deadline,

As it currently stands, CPP and the banks get to keep any unclaimed money they’ve put aside to give back to victims of this mis-selling scandal.

Many might have mistaken the claim form as Payment Protection Insurance (PPI) spam and binned it, particularly as not many will associate CPP with their plans as policies were called things like Card Guard and Card Safe

In February 2014 letters containing claim forms were sent out to the seven million eligible for compensation.

This compensation scheme covers sales and renewals of policies dating back to January 2005. Exactly how much you get depends on which products you have or have held and for how long but compensation pay-outs will include interest. On average the DCA claimants are receiving £188 on average.

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How to claim compensation

If you haven’t completed the form you were sent you need to get your skates on and send it in so that it reaches the scheme’s administrators before 30th August.

If you have lost or thrown away your form you can get a replacement letter by calling the redress scheme’s number 08000 83 43 93 or filling in an online form.

If time is too tight and you aren’t able to get a new form you can still try to claim by writing a letter detailing why you think you are owed compensation.

If you haven’t ever received a form but still think you are due compensation you can try the same. But remember compensation is only available to those with policies that were bought or renewed after 2005.

If you have a policy from before January 2005, you may still be able to claim by contacting the company that sold you the insurance. If it refuses to reimburse you could take your claim to the Financial Ombudsman Service.

As it stands if the compensation form is not received by 30th August 2014 you will lose your right to compensation and the money will be paid back to CPP, banks and credit card companies.

However, if you believe your compensation claim was not handled correctly under the scheme, you would be able to complain to the Financial Ombudsman Service on that point if you are not first satisfied with the decisions of the CPP Scheme Administrator and the Scheme Adjudicator.