Summary of Council decision:
Two issues were investigated, both were Upheld.
Claims on the website www.reclaimppitoday.co.uk promoted a claims management company.
A page accessed by clicking on a tab labelled "I've never taken PPI" was headed "Do you think you've never had anything with PPI?" Text stated "You may think you don't have anything with PPI but if you had a loan, credit card or mortgage at any point over the last 15 years or so there's a very good chance it had PPI added to it and a very good chance you never even knew".
A page accessed by clicking on a tab labelled "Was I mis-sold PPI?" contained a variety of headings including "The benefits of using a claims management company (CMC) for reclaiming PPI". Text stated "We fully understand the processes and systems involved in reclaiming mis-sold PPI, along with how each lender operates its mis-sold PPI team. We deal with them on a daily basis and have the expertise to remove the banks' ability to maneuver [sic] a client to a position they don't want to be in". Further text under the heading "PPI-hit consumers face stalling from banks" stated "Using us will mean you use a resource that has experience and a relationship with banks and can recognise a legitimate rejection from a dubious one".
PJT Enterprises t/a Dispusolve challenged whether the following claims were misleading:
1. "You may think you don't have anything with PPI but if you had a loan, credit card or mortgage at any point over the last 15 years or so there's a very good chance it had PPI added to it and a very good chance you never even knew", because they believed that a payment protection insurance (PPI) premium would have been evident to consumers where one was being charged; and
2. "We fully understand the processes and systems involved in reclaiming mis-sold PPI, along with how each lender operates its mis-sold PPI team. We deal with them on a daily basis and have the expertise to remove the banks' ability to maneuver [sic] a client to a position they don't want to be in", "PPI-hit consumers face stalling from banks" and "Using us will mean you use a resource that has experience and a relationship with banks and can recognise a legitimate rejection from a dubious one", because they believed that those claims implied that using a claims management company would increase the likelihood of a complaint being upheld, when that was not the case.
1. Harwood Claims Management Ltd t/a ReclaimPPIToday said a report by Citizens Advice gave several examples of situations in which consumers were unaware of PPI having been added to their credit agreement. They submitted a Financial Services Authority (FSA) report from 2005, which reported that some firms reviewed had sales rates of 70% for PPI, as well as an Office of Fair Trading (OFT) report from 2006, in which it was reported that there were an estimated 20 million live PPI policies at the time. ReclaimPPIToday said the latter meant there was a significant chance of a PPI policy having been taken out if any form of credit had been obtained. They said a press report referred to survey findings and stated that 25% of consumers were unaware that PPI had been added to a loan. Another press report said "… many were unaware they were even paying for [such policies]". They submitted documents, which they said demonstrated that clients of ReclaimPPIToday had been successful in reclaiming PPI payments, because they had been unaware of it being added to a loan. They believed it was not evident to consumers that they were being charged for PPI.
2. ReclaimPPIToday said the second press report, referred to above, stated that the Financial Conduct Authority (FCA) had found significant issues regarding the way PPI claims were handled in two-thirds of the firms it had visited. The FCA's thematic review highlighted significant failings, including companies rejecting valid complaints, and a third press article stated that consumers had dropped 2.4 million PPI claims between 2010 and 2012. They said the claims in the ad were factual and related to situations in which financial institutions were known to reject legitimate PPI claims, which they could identify and deal with, rather than implying that using a CMC meant an increased chance of success. ReclaimPPIToday said the only reference to an impact on consumers was "PPI-hit consumers face stalling from banks". They believed the reports they had referred to, along with others available in the public domain, demonstrated that to be the case.
ReclaimPPIToday also submitted a Financial Ombudsman Service (FOS) report on its complaint handling, which showed they had upheld 65% of complaints about PPI for the year to date. They said they were complaints that were not previously upheld by financial institutions, which demonstrated that those firms had not properly fulfilled their obligations to customers. They said they were able to provide many examples of where claims initially rejected by financial institutions were upheld by the FOS and said another recent FOS publication further demonstrated the detriment being caused to consumers who did not understand the consequences and reasoning for reduced offers being provided by financial institutions. They submitted examples of claims that had been only partly upheld, contrary to FCA guidelines. ReclaimPPIToday said it was clear from the research cited in the third press report that up to 25% of those consumers were unlikely to have taken matters to the FOS if they had not been represented. Because they as a company understood the reasons for mis-selling, and the basis on which many financial institutions routinely rejected complaints, they could have those rejections overturned with considerable success, often without the need for referral to the FOS. While they believed the ad was not misleading, and that they had supported the claims, ReclaimPPIToday said it would not be repeated in the same form.
The ASA acknowledged that ReclaimPPIToday had amended the ad. We considered the text "You may think you don't have anything with PPI but if you had a loan, credit card or mortgage at any point over the last 15 years or so there's a very good chance it had PPI added to it and a very good chance you never even knew" was likely to be interpreted as suggesting there was a high chance that PPI had been added to the financial products referred to without consumers knowing, if they had taken that product in the past 15 years. We considered such a claim would be particularly relevant to those consumers who might not regularly monitor their financial affairs and might therefore believe they could have been paying for a product without realising.
We acknowledged that it had been reported in the media that there were instances in which PPI had been added to financial products without consumers realising and that ReclaimPPIToday had submitted examples of complaints successfully upheld on that basis. However, one of the press reports they submitted discussed statistics that related to consumers being unaware that claims management companies charged for their representation, rather than relating to them being unaware that PPI had been added to products they had taken. The other report made only a general reference to consumers having been unaware they had PPI. In any case, because we had seen only the press articles, rather than, for example, studies that underpinned them, we considered the media reports were not adequate to support the claim. We also considered the references to sales of PPI in the FSA report and to the number of PPI policies in the OFT report did not demonstrate that there was a high chance consumers had those policies without knowing. While we acknowledged the Citizens Advice report, it gave only anecdotal examples of cases its bureaux had encountered in which consumers had been charged for PPI they were not aware they had or were paying for, as reported in 2004 and 2005. The report did not include statistics on such instances.
Because we had not seen adequate evidence to demonstrate there was a high chance of PPI having been added to loans, credit cards and mortgages taken out in the past 15 years, we concluded that the claim was misleadingly exaggerated.
We considered the claims "We fully understand the processes and systems involved in reclaiming mis-sold PPI, along with how each lender operates its mis-sold PPI team. We deal with them on a daily basis and have the expertise to remove the banks' ability to maneuver [sic] a client to a position they don't want to be in", "PPI-hit consumers face stalling from banks" and "Using us will mean you use a resource that has experience and a relationship with banks and can recognise a legitimate rejection from a dubious one" were likely to be interpreted as suggesting ReclaimPPIToday had a particular insight into lenders processes, such that its understanding could be used to secure a more favourable offer, a faster outcome or an increased chance of successfully appealing a rejection. While we acknowledged the ad did not state that consumers were more likely to have their claim upheld by using a CMC, we considered its overall impression was that ReclaimPPIToday could use its expertise to offer an increased chance of a desirable outcome.
We also acknowledged the concerns outlined in the FCA report but noted it related only to medium sized firms, which accounted for 16% of total PPI complaints. The report was based on those companies' handling of such complaints, rather than relating to all institutions and to outcomes for complaints handled by consumers compared to those pursued by CMCs. As above, although we had not seen any evidence that underpinned the press articles, we considered that a large number of consumers having dropped complaints, and a reported increased probability of escalating a case to the FOS if represented by a CMC, did not necessarily equate to an increased chance of a successful claim. Similarly, we considered examples of complaints being upheld by the FOS following an initial rejection, and general figures that related to that process, were not adequate to support the overall impression that ReclaimPPIToday could offer an increased prospect of a desirable outcome. For the reasons given, we concluded that the ad breached the Code.
On both points, the ad breached CAP Code (Edition 12) rules 3.1 3.1 Marketing communications must not materially mislead or be likely to do so. (Misleading advertising), 3.7 3.7 Before distributing or submitting a marketing communication for publication, marketers must hold documentary evidence to prove claims that consumers are likely to regard as objective and that are capable of objective substantiation. The ASA may regard claims as misleading in the absence of adequate substantiation. (Substantiation) and 3.11 3.11 Marketing communications must not mislead consumers by exaggerating the capability or performance of a product. (Exaggeration).
The ad must not appear again in its current form. We told ReclaimPPIToday to ensure their future ads did not state or imply there was a high chance that PPI had been added to financial products without consumers' knowledge, or that their service offered consumers an increased chance of success, if that was not the case.