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6 Jan 21

Natwest paying expensive lawyers to defend small claims

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It is believed that the NatWest group has spent more than £10,000 on individual court cases defending recent PPI claims. Judges in some cases have questioned why the bank, which is 62% owned by the taxpayer, is spending so much money on barristers and solicitors to defend small claims.

The deadline for making PPI claims passed in August 2019 but claims can still be made regarding undisclosed commission charges.  According to the Competition and Markets Authority commission charged on PPI was typically 40-80%i, and in some cases commission was up to 95% of the premiums paid.  Consumers can now make claims through the litigation process to claim back the full amount of commission they paid on PPI premiums even where a PPI policy was not mis-sold; the argument being that if a consumer had been aware of the high level of commission they would not have taken out the policy in the first place.

The Times reports: “RBS lost an appeal against Karen Smith, a former customer. She lodged a claim worth about £1,500 using the firm The Claims Guys Legal. In his decision, which was published in November, Judge Allan Gore QC at Exeter county court, referred to RBS as a “multinational major corporate defendant represented by highly experienced and regarded lawyers.”ii

Some firms of solicitors are expecting the number of these claims to rise as more people become aware of this type of claim,  now widely referred to as a ‘Plevin PPI claim’, which means banks are keen to obstruct and prevent this new wave of claims if they can.

Sources:

i. https://www.gov.uk/cma-cases/payment-protection-insurance-ppi-market-investigation-cc

ii. https://www.thetimes.co.uk/article/natwest-pays-thousands-to-fight-ppi-claims-in-court-wpcmlwkfx

iii. https://www.thisismoney.co.uk/money/markets/article-9089443/NatWest-blasted-legal-costs-new-PPI-cases.html