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  1. #1
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    Default PPI-claims boss probed over £11.6m payout

    From today's Sunday Times.

    PPI-claims boss probed over £11.6m payout

    The taxman is investigating a company led by a 30-year-old who has amassed a multimillion-pound fortune from PPI mis-selling claims.

    Ibrar Akbar is the director and largest shareholder of Harringtons Advisory, one of the crop of claims handling agencies that have got rich from the £30bn payment protection insurance scandal.

    HM Revenue & Customs is investigating payments of £11.6m to a “remuneration trust” over the past two years, according to Companies House records.
    HMRC is scaling up its inquiries into so-called disguised remuneration schemes. These vehicles are typically used to pay company directors through loans that are not subject to income tax or national insurance.

    Harringtons said in its annual report, signed by Akbar, that “it is not possible to predict the outcome of this inquiry . . . The directors, based on professional advice, believe that the company has sound arguments to refute any assessment of tax due.”

    Bury-based Harringtons is also under investigation by the Ministry of Justice over 15 separate alleged breaches of the rules governing how consumers are dealt with.

    Handling claims for customers who believe they were wrongly sold PPI by banks and other providers has evolved into a huge industry, which now employs thousands of people across the country.

    More than 1,600 companies have registered with the Ministry of Justice to process such complaints. Over the past five years, the top five agencies have paid out nearly £65m in salaries, dividends and director loans. A claims agent at Harringtons said Akbar and the company were unavailable for comment. HMRC declined to comment.
    https://www.thetimes.co.uk/edition/b...yout-vrrp669j3

    Cops or robbers . . . the bosses cashing in on PPI

    Claims chasers have made fortunes out of banks’ greed and customers’ misery.

    Richard Duggins could not believe his luck. Having already received thousands of pounds in compensation for mis-sold insurance from 2005, a friendly salesman assured him it would be worth his while to try again.

    Banks that had lured millions of customers into buying payment protection insurance (PPI) were now going back over old claims, he was told. Duggins could be in for another payday. “I was really surprised. I had already got some money from a bank, so this was just a bonus,” he said.

    The conversation took place in early February and within a few weeks a letter arrived explaining that HSBC had agreed to pay a claim of more than £1,200. But the bonus was not as big as Duggins had expected.

    Harringtons Advisory, the Bury-based employer of the friendly claims handler, was adding a staggering 39% charge for “clerking and advisory fees” along with 20% VAT. “In the end I was getting £70 more than the claims company,” said Duggins, a 60-year-old former warehouse worker, who lives in Redditch, Worcestershire.

    “I haven’t given it to them. We discussed a 25% charge on the phone, I never signed up to anything this high. After I got the letter, I googled claims company fees and realised a lot of these companies are overcharging.”

    More than 64m PPI policies were sold to about 30m people between 1990 and 2010. PPI was an insurance policy that offered peace of mind that your mortgage or loan would still be repaid if you lost your job, or were struck down with serious illness.

    However, the Financial Conduct Authority (FCA) concluded that many customers did not understand the cover or need it.

    The PPI scandal has cost Britain’s banks £30bn in compensation payments — enough to pay the salary of about 1.3m NHS nurses for a year, or buy 10 new aircraft carriers for the Royal Navy.

    Lloyds Banking Group alone has set aside £18bn for customers, almost as much as it received from taxpayers in bailout money in 2008. Royal Bank of Scotland, which is still 71% owned by the taxpayer, has earmarked £4.8bn to settle the issue.

    A large proportion of the claims made by consumers have been handled by the catchily named agencies that advertise their services extensively on daytime television and cold-call people at home. Often they take about 40% in fees. Increasingly, questions have been asked about aggressive sales practices used to generate those commissions.

    It is a lucrative business. There are 1,610 companies registered with the Ministry of Justice to handle these claims. The five largest have booked nearly £600m in revenues since the PPI scandal began in 2011. Since then, the owners of those five firms have taken out nearly £65m in dividends, salaries and director loans, according to data from Companies House. Many of the entrepreneurs running these businesses are barely in their thirties.

    A new boom in claims is now under way. The City watchdog has said that no new claims will be accepted after August 2019. That deadline has prompted an additional flood of advertising by the claims handlers.

    Results published over the past two weeks show that the banks have set aside a further £1.8bn to compensate customers in anticipation of this new wave of claims. It will bring another windfall for the middlemen and women trying to persuade consumers that they should handle their complaint.

    “We have seen the volume of PPI claims increase over recent months and that has been the result of a marked effort by claims companies,” said Stephen Noakes, group customer services director at Lloyds. “A number are warning customers that time is running out.”

    Lloyds, which sold the most of Britain’s PPI policies, still receives 9,000 complaints a week and employs 4,500 people just to handle the claims.
    In private, all the banks allege that a large proportion of the claims they now receive are spurious. The genuine cases of injustice were mostly dealt with years ago. Now, the scandal has evolved into a costly time-wasting exercise.

    RBS said that, currently, about 35% of claimants were never sold PPI. Another bank insists that 40% of its claimants were never customers. “A lot of people who receive cold calls get talked into making a claim,” said Matthew Upton, head of policy for consumer and public services at Citizens Advice. “We had 3,000 complaints last year about phone calls, fees and people not understanding their contract.” Upton added: “People were clearly ripped off by their banks 5, 10 and 15 years ago, and this is the second time they appear to be being ripped off.”

    Concerns about the volume of false claims, and the never-ending provisions, prompted the FCA to impose the August 2019 deadline. Claims firms argue that this is unfair and that there could still be £50bn of outstanding claims.

    We Fight Any Claim, one of the largest firms, which uses former Monty Python star John Cleese in its television adverts, is fighting a High Court legal battle to extend the deadline. It is easy to understand its motivation. Directors have been paid nearly £2m since 2012, while the company has lent its 61-year-old owner, Joy Chorlton, almost £32m in that period.

    Flairford Securities — the parent company of Brunel Franklin, which bills itself as “the PPI refund specialists” — has paid out more than £11m in dividends and £2m in salaries and benefits to its directors, including its former chairman, Michael Goldstone, 72.

    Warrington-based Gladstone Brookes has paid out more than £250,000 to directors since 2012, but dividends in excess of £4.3m — mostly to its founder, Lisa O’Neill, 37. The Claims Guys, the largest PPI claims company in terms of its £47m annual turnover, has paid more than £12m in dividends.

    “We have found that 80% of the people who received compensation never knew they had PPI,” said Richard Thomas, managing director of We Fight Any Claim. “It’s an easy narrative to push that claims companies are the bad guys. If the banks had just paid all the customers that were mis-sold PPI, we wouldn’t need to exist.”

    Thomas has a point. The banks initially put up stiff resistance to the notion that they had mis-sold policies, but lost a court ruling in 2011 that opened the floodgates to claims.

    A Supreme Court ruling in 2014 forced the banks to look again at some of the claims they had rejected. The financial ombudsman has upheld more than 64% of all the consumer complaints against Lloyds about its policies.

    Nonetheless, claims companies are attracting scrutiny. Harringtons Advisory, which is one of the 10 largest PPI claims companies, had its licence temporarily suspended by the Ministry of Justice in February. It has since appealed against that decision and is currently under investigation.

    According to its most recent annual report, the firm, owned by Ibrar Akbar, 30, who went to Bolton Sixth Form College, is also being investigated by HMRC having set up a remuneration trust and moved £11.6m into the tax management vehicle.

    Claims Advisory Group, a Manchester-based firm part-owned by Terrence O’Neill, 50, is also in the crosshairs of the tax man. The company, which paid its directors nearly £2m, was forced to reveal in its latest annual report that HMRC has accused it of using an “incorrect” VAT status. Like Harringtons Advisory, it denies wrongdoing, but has set aside over £7.6m to deal with the issue.

    The FCA is keen to push consumers to make their own claims, without any agency taking a cut of the fees. From August 29, two years before the claims deadline, the City watchdog will begin its own advertising campaign — funded by the banks.

    Speaking from Ibiza, Brunel Franklin’s Goldstone said: “We’ve done quite well, but not as well as any of us expected to do. The cost of opening up a new inquiry is actually quite expensive.”
    https://www.thetimes.co.uk/article/c...-ppi-r6hmgj5zs
    Well, she's walking through the clouds, with a circus mind that's running wild
    butterflies and zebras, and moonbeams and fairy tales
    that's all she ever thinks about
    riding with the wind.

    When I'm sad, she comes to me, with a thousand smiles she gives to me free
    it's alright, she says it's alright, take anything you want from me
    anything.

    Fly on little wing.

    Jimi Hendrix



  2. #2
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    Default Re: PPI-claims boss probed over £11.6m payout

    "Speaking from Ibiza" pmsl....
    “We may not win by protesting, but if we don’t protest we will lose. If we stand up to them, there is always a chance we will win.” Hetty Bower

    Any advice I provide is given without liability, if you are unsure please seek professional legal guidance.

    Find Solicitors offering fixed fees on our sister site - JustBeagle.com

  3. #3
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    Default Re: PPI-claims boss probed over £11.6m payout

    ''Anthony Chorlton and Lisa O’Neill of Gladstone Brookes''.
    Attached Thumbnails Attached Thumbnails Lisa.jpg  
    Well, she's walking through the clouds, with a circus mind that's running wild
    butterflies and zebras, and moonbeams and fairy tales
    that's all she ever thinks about
    riding with the wind.

    When I'm sad, she comes to me, with a thousand smiles she gives to me free
    it's alright, she says it's alright, take anything you want from me
    anything.

    Fly on little wing.

    Jimi Hendrix



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