Bank of Scotland owner Lloyds has been slapped with a £90.7 million fine after its insurance division was found to have sent misleading renewal quotes to nearly nine million customers.
Issuing its largest penalty since 2019, the Financial Conduct Authority (FCA) said the renewal quotes claimed the amounts were "competitive" when in fact new customers could get a better price on the same products elsewhere.
The bank took almost a decade to remove the language from all of its communications. It also falsely promised loyalty discounts to approximately 500,000 customers.
The FCA said the breach of rules caused a "risk of harm for the majority of LBGI (Lloyds Bank General Insurance) home insurance customers" when sent out between January 2009 and November 2017.
READ MORE: Financial sector bosses' pay could be linked to diversity and inclusion targets
"Firms must ensure their communications with customers are clear, fair and not misleading," said Mark Steward, executive director of enforcement and market oversight at the FCA.
"LBGI failed to ensure that this was the case. Millions of customers ended up receiving renewal letters that claimed customers were being quoted a competitive price which was unsubstantiated and risked serious consumer harm.”
The FCA said LBGI has voluntarily made payments of approximately £13.5m to customers who received communications that erroneously referred to the application of a discount when none was applied, and that this was taken into account in the assessment of the financial penalty.
LBGI is contacting customers proactively, meaning customers do not have to take any steps to receive payment. The FCA continues to engage with LBGI on the voluntary payments process.
Glasgow chef Nico Simeone opens largest restaurant to date
Next month will see the opening of the eighth and largest of the Six by Nico restuarant chain.
The 100-cover Six by Nico Canary Wharf opens on August 9 and will be Nico Simeone's second location in London. The 4,219sq ft restaurant includes a 20-cover outdoor terrace overlooking the docks of the Thames.
“We have always had big ambitions and our team are excited to be opening our second London location in Canary Wharf," Mr Simeone said. "The restaurant is our biggest yet and it has been a joy to recruit our 50-strong team, especially following the hardest of times that the hospitality industry has weathered.
"We feel incredibly lucky to be in a position to expand our portfolio and I look forward to bringing our one-of-a-kind dining experience to the area. London has always been integral to our growth and Canary Wharf’s proximity to the backbone of the city, the Thames, lent itself perfectly to my curated expansion plan.”
READ MORE: Six by Nico chef gifts first restaurant to former kitchen porter
Travel opening up, but consumer caution remains
Following today's confirmation that fully-vaccinated individuals will soon be able to return from amber list counties without quarantining, a new survey by PwC has found that consumer sentiment towards holidaying this summer remains cautious as other barriers to travel remain.
Of the 2,000 people polled, 32 per cent cited the potential need to quarantine as the biggest barrier to travelling in 2021. Almost a third, 30%, feared getting Covid whilst at their holiday destination or during travel.
Only a third thought the Government's traffic light system made sense as a way to manage risk, with one in five saying the government’s advice had put them off travelling abroad.
Compared to March, all age groups were less willing to travel internationally in the short term, though younger consumers remain the most willing to do so. Across all age group, 35% plan not to take a holiday at all.
READ MORE: Government working on plans for quarantine-free travel
David Trunkfield, hospitality & leisure leader at PwC, said today's announcement privdes some welcome clarity and should be a boost to the travel industry. However, other issues remain.
“Fear of getting Covid, changing Government guidance and the need for testing, as well as possible destination restrictions, continue to hamper bookings for holidays abroad in 2021 and will continue to factor into decision making," he said.
"Whilst we found that younger consumers are the most willing to travel, adults under 35 are least likely to be fully vaccinated and therefore the removal of the need to quarantine will not benefit them in the short-term. Nevertheless, today's news should lead to an increase for outbound bookings, with the prospect of a stronger market into September and beyond."
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