Companies fail on PPI selling

Financial Services Authority chief executive Hector Sants told the Treasury Select Committee yesterday that companies had failed to tackle payment protection insurance PPI mis-selling.

He said they had made “very disappointing” progress towards tackling poor practice.

The watchdog will step up intervention to defend customers and force companies to treat complaints fairly, Mr Sants told MPs. He said market confidence was put in jeopardy when customers were sold products they did not need.

“There’s no question that effective deterrence requires swift and effective action and higher levels of fines and deterrents,” Mr Sants said. Companies had been “very slow” to alter their behaviour although “we’re now seeing some changes”, he said.

The FSA has fined some 20 companies about £12m over PPI mis-selling in the past year.

The Guardian reports that Tory leader David Cameron has called for business leaders responsible for wrong doing should be prosecuted.

In a speech at Canary Wharf, Cameron said: "Doctors who behave irresponsibly get struck off; bankers who behave irresponsibly should face professional consequences. And, for sure, if anyone is found to have behaved criminally, they must be prosecuted. Of course, this requires clear evidence of wrongdoing. But that doesn't mean we should sit on our hands and say it's all a failure of regulation."