The High Court has ruled today in favour of the Financial Services Authority in relation to the mis-selling of Payment Protection Insurance.

The British Bankers’ Association launched a judicial review in January in response to the FSA’s approach to the handling of PPI complaints.

The FSA suggested that retrospective compensation should be in place for the mis-selling of PPI, which would lead to up to £2.7bn in compensation being paid to 2.7 million people. The ruling means all cases will now have to be judged on today’s regulations and not those at the time, which could have consequences for other areas of the financial services sector. Since the BBA launched its legal challenge in October 2010, the FOS has been receiving up to 5,000 PPI cases each week.

Natalie Ceeney, chief ombudsman, says: “This judgment is very clear-cut – and it confirms that the ombudsman’s approach to PPI complaints is right. People have been waiting a long time while the banks’ legal action has been ongoing. I would now like to see financial businesses showing real commitment to sorting out their customers’ complaints efficiently and promptly.”

 A spokeswoman for the BBA, says: “We are disappointed with today’s judgment and now need to consider the details of it very carefully as well as next steps, including whether it would be appropriate to apply for permission to appeal.

 “Any complaints that are directly affected by the judicial review and therefore can not be decided will continue to be placed on hold until the next steps have been decided. We will continue to work closely with the FSA to ensure that all complaints are appropriately handled and customers are not disadvantaged.

“Customers who are considering making a complaint or who have a specific query about an existing complaint should contact their bank in the first instance.”

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