Worried CPP staff tell watchdog of clampdown effects

0
Have your say

ANXIOUS staff at credit card insurer CPP Group have written to the City watchdog to warn a clampdown for mis-selling risks the livelihoods of hundreds.

Staff from the York-based group’s employee communication forum wrote to Hector Sants, chief executive of the Financial Services Authority. They insisted the firm provides a valuable service and the FSA’s sanctions could hurt customers.

CPP this week said its future is in jeopardy after an FSA probe called for a review of past sales and changes to renewals.

CPP sells card, phone and wallet protection to customers of major banks and building societies. It has warned the watchdog’s unspecified demands – thought to be a deep review of past sales and an end to automatic renewal of contracts – threaten its viability.

The company is negotiating with the FSA in an attempt to water down its demands, but has suspended its shares and warned of a hefty financial impact as it could have to recompense customers who were mis-sold policies.

“We are extremely concerned that the proposals from the FSA regarding CPP are likely to have a severe impact on not only CPP’s customers but our people across our four sites in the UK,” said staff.

They called for Mr Sants to visit its offices to see how the firm works and the potential impact of its demands. CPP employs 1,969 staff, including about 1,000 in York.

“Your proposals will have a negative impact on our customers who are passionate about our products and feel they are valuable to their everyday lives,” wrote staff.

“We feel that by stating that you believe we are mis-selling on a large scale is an attack on our integrity as people, and what we are trying to do on a daily basis for our customers.”

CPP Group was founded as Card Protection Plan Ltd in 1980.

The FSA declined to comment.