PPI claims have been cropping up since the mid 2000’s and are growing as time goes on. Thousands of banks in the US and the UK have geared up for possible payments of billions of dollars to consumers who were mis-sold PPI and are now filing for compensation. However, this does not mean that illegal activity within the banking industry is no more. Banks have been levied fines for mis-dealings in PPI and Libor scams but are merely paying the fines and continuing to practice the same unsavory lending procedures.
Above the Law
Banking institutions have long felt they were immune from government action in their daily business practice and are somewhat correct. PPI UK claims have totaled billions of pounds in the last five years or so and banks have merely set aside money to pay off consumers who feel they were wrongly charged. Often times, the banks will offer a “payoff” to consumers of only a portion of the claim; however there is an Ombudsman organization which is available to help consumers get what’s rightly theirs. A quick search on the web for PPI claims will point you in the right direction.
When Will it End?
Many economists feel the only way to correct the mistakes and a downright illegal action of banks is to let them fail or close down banks who have created this disastrous lending fiasco and start over. Of course, this does seem to be a bit extreme but the banks have been basically stealing money from consumers for years and still continue to do so. President Obama has bailed out several banking institutions in the US to the dismay of may economic professionals who feel this was like telling them it’s ok. Many banks have come under fire for mis-representing their financial position by doctoring their books to look as if they were in a sound position. Once this had been discovered, the banks were merely fined; which they gladly paid and continue on in the same manner as before. Hopefully this will not continue.