Close Brothers Group Plc is a financial services group operating primarily in the United Kingdom The company provides lending, wealth management, and securities trading services to clients in the UK and select international markets As with any financial services company, Close Brothers Group Plc is subject to certain regulatory requirements and faces risks that could affect its financial position and reputation.
In recent years, Close Brothers Group Plc has faced a number of claims related to its lending practices These claims have come from both customers and regulators and have raised questions about the company’s treatment of its clients Some of the most notable claims are discussed below.
Mis-Selling of Payment Protection Insurance (PPI)
One of the most common types of claims in the UK financial services industry in recent years has been related to the mis-selling of Payment Protection Insurance (PPI) PPI is an insurance policy sold by lenders to borrowers, often alongside loans and credit cards It is designed to cover the borrower’s repayments in the event of an illness, accident, or job loss However, many borrowers were sold policies that they did not need or were not eligible for.
Close Brothers Group Plc is one of many financial services companies that have faced claims related to PPI In 2017, the company announced that it had set aside £4 million to cover potential claims related to PPI mis-selling The Financial Conduct Authority (FCA) has estimated that the entire UK banking industry will pay out more than £50 billion to customers who were mis-sold PPI.
Unfair Treatment of Small Businesses
Another area of concern for Close Brothers Group Plc has been its treatment of small businesses In 2016, the company was accused by the UK’s Treasury Select Committee of treating small businesses unfairly in its lending practices Close Brothers Group Plc claims. The committee heard from a number of small business owners who claimed that they had been pressured into taking on loans that they could not afford and that Close Brothers Group Plc had failed to provide adequate support when they faced financial difficulties.
Close Brothers Group Plc denied the allegations and stated that it had a strong record of supporting small businesses However, the accusations prompted the company to review its lending practices and to strengthen its support for small businesses.
Breaches of Money Laundering Regulations
In 2020, Close Brothers Group Plc was fined nearly £1.9 million by the FCA for breaches of money laundering regulations The regulator found that the company had failed to carry out appropriate due diligence on customers and had not put in place effective systems and controls to prevent money laundering.
The FCA stated that the breaches were serious and that they had occurred over a period of several years Close Brothers Group Plc acknowledged the breaches and stated that it had taken steps to address the issues and to improve its systems and controls.
Non-Transparent Costs
Close Brothers Group Plc also faced criticism in 2018 for non-transparent costs The UK’s financial regulator, the Financial Conduct Authority (FCA), launched an investigation into the company’s secured loans division after concerns were raised about the way in which it disclosed costs The FCA found that the company had not made it clear to customers how much they would be paying in interest and other fees.
As a result of the investigation, Close Brothers Group Plc agreed to pay £700,000 in compensation to customers who had been affected by the non-transparent costs The company also agreed to improve the way in which it discloses costs to customers.
In conclusion, Close Brothers Group Plc has faced a number of claims related to its lending practices and regulatory compliance While the company has denied some of the allegations, it has acknowledged others and has taken steps to address any issues identified As a financial services company operating in a heavily-regulated industry, Close Brothers Group Plc must ensure that it is meeting its obligations to its customers and regulators to protect its financial position and reputation.