FSA investigating Lloyds over mis-selling
It comes as the FSA published a wider report on mis-selling and announced a crack down on sales incentives that risk encouraging it.
The regulator said it found 90% of firms it surveyed used “risky” sales incentives while one sales team was found to have had their bonuses multiplied eight times for cross-selling protection.
The FSA report said: “Twenty out of the 22 firms we assessed had features in their incentive schemes that increased the risk of mis-selling.”
It referred to “one firm” which it said had been referred to its Enforcement and Financial Crime Division – this later emerged as Lloyds.
Lloyds issued a statement saying “it was working closely” with the FSA and had made “significant changes to our incentive schemes” in 2012.
And it added: “Today these schemes reward staff for providing high quality customer service, assessed by a wide range of metrics. We reward behaviours that are focused on achieving correct customer outcomes and excellent service as well as monitoring sales to ensure that colleagues have met customer needs appropriately. We also review our schemes four times a year to ensure they remain relevant and appropriate.”