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October 1, 2009

Judge writes off credit card debt on PPI mis-sale

by Gill Montia

Story link: Judge writes off credit card debt on PPI mis-sale

A ruling made by South Shields County Court could have a major impact on consumers struggling with credit card debt.

In a case involving credit card firm MBNA, Judge Jacqueline Smart has ruled that the £8,000 plus debt owed to the company by Lynne Thorius should be written off because she had been mis-sold payment protection insurance (PPI).

Judge Smart found that the circumstances amounted to an unfair relationship between Ms Thorius and MBNA.

Ms Thorius was represented by Manchester-based claims management firm, Cartel Client Review, and according to reports, the successful outcome rested on the fact that Ms Thorius had declined PPI when applying for the credit card but MBNA went ahead and added it anyway.

MBNA has responded by saying that no legal precedent has been set.

At least it will be one less case for the lender to investigate following yesterday’s announcement by the Financial Services Authority that firms who have sold single premium PPI alongside unsecured loans and credit card agreements must review complaints and compensate those consumers identified as mis-sold.

According to the regulator, the new measures will tackle the key issue that too many complaints are rejected by firms and then overturned by the Financial Ombudsman Service in favour of the consumer.


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