Lloyds issued with legal directions for PPI breaches

Oct 4th '18

The Competition and Markets Authority (CMA) has taken action against Lloyds Banking Group (Lloyds) for serious breaches affecting thousands of PPI customers.


The CMA has issued Lloyds with legal directions after it failed to send annual payment protection insurance (PPI) reviews and provided incorrect PPI data to its customers. It is now requiring Lloyds to put effective systems and procedures in place to prevent similar incidents from happening in the future.


This is not the first time Lloyds has breached the CMA’s PPI order, having reported 6 breaches in 2016 for failing to provide customers with correct data and annual reminders.


The CMA’s action comes after an investigation into PPI by the Competition Commission, concluding in 2011. One of the measures introduced was for customers to receive an annual review once a year from their provider, setting out clearly how much they had paid in and their right to cancel the policy.


The CMA decided to act against Lloyds after IT problems meant approximately 14,000 of its customers did not receive this reminder between 2012 and 2018. Lloyds also provided incorrect information on PPI premiums in annual reviews it sent to 2,884 customers.


Adam Land, the CMA’s Senior Director of Remedies, Business and Financial Analysis, said:

We are disappointed that Lloyds has again failed to provide these important reminders or provide accurate data to its customers.

These are serious breaches and, as we did with Barclays in August, we are issuing Lloyds with legal directions which can be enforced by a Court to ensure they comply.

Following a series of breaches, we’re now requiring legal assurances from Lloyds that they have measures in place to prevent similar breaches from ever happening again.


The annual PPI review is an important measure so customers know they still have a policy and how much it is costing them each year, as well as their right to cancel or switch.


Lloyds has started sending its apology letters to affected customers and has provided a reminder of their right to cancel the policy and an offer to refund premiums.


Source: CMA



  1. Lloyds Banking Group is in breach of the Payment Protection Insurance Market Investigation Order 2011 (the PPI Order). One of the requirements of the order is that all PPI customers would receive an annual review from their provider setting out information including how much they had paid into their policy.
  2. Directions are a formal enforcement instrument, which can be used to ensure that an Enterprise Act 2002 remedy imposed by the CMA, in this case the PPI Order, is complied with fully.
  3. On 28 June 2018, Lloyds notified the CMA of the breaches. The CMA acknowledges the co-operation it has received from Lloyds during the course of the investigation into these breaches and the actions already taken by Lloyds.




Lloyds Banking Group (LBG) breached the Order in the following ways:

  • It failed to send Annual Reviews to its customers who held PPI with Bank of Scotland and Lloyds Bank and who were entitled to receive such statements for the period between 2012 to July 2018.
  • It sent information to customers who hold PPI on their TSB credit card accounts which showed that their PPI premiums were less than what was actually charged.