CLAIMS management firms will face fines if they send banks too many false PPI claims, under rules unveiled by the Treasury and Ministry of Justice yesterday.
Banks have complained that they are inundated with false claims, delaying the processing of valid mis-selling claims and adding to their costs.
A consultation will be launched this week to define exactly how bad a claims firm will have to be to get a fine, and the size of the fine. The fines are expected to be several thousands of pounds, depending on the size of the firm.
Previously the only punishment available was a ban, which would affect valid and invalid claims.
Other claims such as personal injury claims will also be covered.