Barclaycard pulls CPP service as FSA probe continues

CREDIT card insurer CPP Group said today that Barclaycard has decided to halt sales in the call to confirm channel after the City watchdog’s decision to carry out a probe.

York-based CPP, which last month announced that the Financial Services Authority is investigating “alleged failings” in its sales calls for its credit card and identity theft products, said Barclaycard was carrying out a review of the service.

CPP said it will continue to offer card protection to Barclaycard customers who hold the Identity Protection product and who call its customer service department and that Barclaycard will also continue to offer identity protection and card protection to its customers in all their existing channels.

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Sales to Barclaycard customers in the call to confirm channel make up less than 2 per cent of CPP revenue.

In a statement the Yorkshire firm said: “The impact on underlying operating profit in 2011 and 2012 will be immaterial although reduced sales in 2011 and 2012 will have an adverse impact on the profitability beyond 2012 as the renewals revenues (upon which CPP pays a smaller commission to its Business Partners) will also be lower.”

CPP has more than 200 business partners and said it had been encouraged by the support received from them.

It added: “Any product sales as have been suspended by business partners other than Barclaycard have to date been at levels which are not material to the group.

“Whilst the group believes that new business volume uncertainty may remain whilst the FSA investigations progress, the board continues to believe in the ongoing relevance and consumer appeal of its products and services.”

Last month CPP, which floated on the London Stock Exchange in 2010, suspended sales of its ID theft products but insisted it has not misled customers and will fight the FSA probe.