Not upheld: mis-selling of packaged bank accounts complaint against Lloyds Bank PLC

Decision detail

Summary

Mr W complained that Lloyds mis-sold him Premier (2010) and Platinum (2016) packaged accounts, claiming they were presented as necessary for debt management and overdraft access, without proper suitability checks. The ombudsman found that Mr W was aware packaged accounts were optional, having previously held fee-free accounts, and that he already had an overdraft facility before upgrading. The Premier account was sold on a non-advised basis with benefits and costs discussed, and Mr W subsequently used multiple insurance benefits. The Platinum account was self-initiated online after a two-year gap, demonstrating Mr W's informed choice. The complaint was not upheld and no refund was ordered.

The Ombudsman's reasoning

The ombudsman found that Mr W was aware the packaged accounts were optional, having previously held and downgraded from a fee-free account. The Premier account was sold on a non-advised basis, so Lloyds was not required to check suitability of insurance benefits. Even if it had been advised, the account was a reasonable recommendation as Mr W demonstrably benefited from multiple features including overdraft benefits, travel insurance, breakdown cover, and mobile phone insurance. Mr W's account statements did not show financial difficulties at the time of sale. For the Platinum account, the two-year gap between downgrading and re-upgrading, combined with Mr W's online self-initiated upgrade and prior knowledge that packaged accounts were optional, indicated no mis-selling occurred.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website