Northern Rock PPI Claims: The Story
As a result of the merger between two North East building societies, the Northern Counties Permanent Building Society and the Rock Building society, both of which were established in the 1800s, Northern Rock Building Society was formed in 1965.
Northern Rock expanded in the next 30 years by acquiring 53 smaller building societies and most notably, in 1994 they got the North of England Building Society.
Also during the 1990s, they chose to demutualise and float on the stock exchange in order to be able to expand their business more easily. This led to them being able to gain promotion to the FTSE 100 index in the year 2000 but they were quickly demoted back to the FTSE 250 in December of 2007.
Pardon the pun but the bank fell upon hard times and during the financial crisis in 2007, they sought and received a liquidity support facility from the Bank of England after experiencing problems in the credit market.
The bank was nationalised in February 2008 as a result of two unsuccessful bids to take the bank over with neither being able to full commit to repayment of taxpayers’ money. Thanks to this, the Government took ownership away from shareholders without reimbursement.
In January 2010, the bank was split into two parts; assets and banking. In June 2011 the bank was officially put up for sale and in November 2011 it was announced that Virgin Money would be buying Northern Rock for £747 million up front with further payments of £280 million. The sale went through on January 1st, 2012 and in October of that year, Northern Rock plc was renamed Virgin Money plc.
Fines and Bans
Having had their fair share of troubles in the last few years you’d be forgiven thinking that they couldn’t go through anything else. Well, if you’re aware of the scale of the PPI mis-selling scandal, you won’t be surprised to learn that Northern Rock are just as guilty as the other lenders involved in the Payment Protection Insurance scandal.
Not only are they guilty of mis-selling payment protection insurance, in 2010 two former directors of Northern Rock were fined by the Financial Services Authority and banned from working for a regulated financial firm again.
Former deputy chief executive, David Baker was fined £504,000 for misreporting mortgage arrears data, and the former credit director Richard Barclay was fined £140,000 for also failing to ensure accurate financial information.
The two fines that were received by both former employees were reduced as they were both cooperative and admitted to their misconduct among other factors. The fine received by Mr Baker was cut from £720,000 but it is still one of the biggest individual fines levied by the regulator. Mr Barclay faced a £300,000 fine but this was slashed to the £140,000 he eventually received.
Northern Rock PPI Claims
Although they’re not at the same level as the likes of Barclays, Lloyds and Santander who have all set aside billions to cover their costs for their part in the PPI scandal, Northern Rock still have millions that they need to pay out.
The holding company for any Northern Rock PPI claims and liabilities, NRAM (Northern Rock Asset Management) claim that they have attempted to contact every single customer that has been affected by the PPI mis-selling. This is akin to asking a burglar to contact their victim to ask if they want their stolen belongings back! So far as we are concerned, it should never have been left to NRAM to contact customers, it should have been the regulator who contacted them.
Are you sat reading this now thinking that you haven’t been contacted at all, or you’ve moved house yet you still haven’t been contacted?
You are far from being alone, we hear from Northern Rock customers regularly who haven’t received any contact, from NRAM.
There are approximately still 7 million people out there who haven’t made a claim against mis-sold PPI. You could be one that is owed thousands so why not start your claim today and leave the hard work to us?