LONDON -Lloyds Banking Group has been fined 91 million pounds($125.25 million) for misleading insurance customers over an eight year period, in one of the largest fines levied against a lender for such breaches by regulators.
The Financial Conduct Authority said several of Lloyds’ insurance units sent renewal notices to millions of customers while failing to ensure the language was clear, fair and not misleading.
“Millions of customers ended up receiving renewal letters that claimed customers were being quoted a competitive price which was unsubstantiated and risked serious consumer harm,” said Mark Steward, executive director at the FCA.
The breach involved nine million renewal communications between 2009 and 2017, the FCA said.
In addition, around half a million customers were told they would receive a “loyalty” discount, but this was not applied and was never intended to apply, the watchdog said.
Lloyds has since paid around 13.5 million pounds to customers who were told about the discount, the FCA said.
A Lloyds spokesperson said: “We’re sorry that we got this wrong. We’ve written and made payment to those customers affected by the discount issue and they don’t need to take any further action.”