FSA has fined Egg Banking plc £721,000 for failings in its sales of credit card PPI. It found breaches of Principles 3 and 6 which led to around 40% of Egg's telephone sales of PPI not complying with the Principles. Its main fault was to tell its telephone sales staff to use "objection handling" techniques to persuade customers who said they did not want PPI to take it. It:  

  • failed to get customer consent to the start of cover;
  • did not get explicit consent to proceed on limited information;
  • did not handle objections appropriately, and anyway was meant to follow a nonadvised sales process; and
  • gave inadequate responses to customer queries.  

At worst, it applied PPI to the card without customer consent. Margaret Cole said it was unacceptable that Egg did not identify the problems with its sales process despite numerous FSA communications. Its monitoring and MI systems did not allow the firm to detect and address the problems. Egg has stopped selling credit card PPI, contacted its customers and is compensating them where appropriate.