Nationwide has been issued with legal directions by the Competitions and Markets Authority (CMA) after it both failed to send and sent inaccurate PPI reminders to more than 7,000 customers.
The CMA’s directions require Nationwide to put new legal procedures in place that will ensure similar issues don’t happen again.
The building society has already repaid more than £100,000 to customers who did not receive reminders, and Nationwide is also in the process of refunding thousands more customers who received inaccurate information – with total repayments expected to reach up to £2m.
The CMA has suggested that any company breaking the rules should refund its customers, if as a result of the PPI provider’s failure to provide important information, those customers are left worse off.
Senior director of remedies, business and financial analysis at the CMA, Adam Land, commented: “Nationwide has broken the rules by not sending essential PPI reminders to their customers. Eight years on from our legally binding order, it is simply unacceptable that the CMA is having to remind Britain’s biggest banks of their legal obligations.
“Nationwide has failed its customers by denying them important information, and the directions we’ve issued today will lead to affected customers receiving the refunds they deserve.”
Whilst the CMA cannot currently impose financial penalties for breaches of this kind, it has called for the power to do so, and the Government is set to consult on the CMA’s proposal.
“Such breaches are serious,” Land continued, “And if we had the extra powers we’ve proposed to the government, (they) could have resulted in fines.”
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