The laudable cause of protecting the home buyer, those that have not already been victim to the world financial conflagration, has been misused by the banking industry.

With their already established complicity in the international financial meltdown of the recent past, one might grow to question the integrity of those in charge of the field. Where there is a lot of money, corruption is almost assuredly to follow.

The banks, failing here and failing there, are still essential to society at large. Many watchdogs are in place but hey are sleeping on the job. PPI, the much needed protection for the home buyer, must continue in some form, with upgraded oversight by those already being paid to do the job. A slap on the wrist and going to sleep less their milk and cookies later will repair the program and reboot consumer confidence in real estate. Greater accountability is the byword.

The Financial Ombudsman Service, along with the Association of British Insurers must work together with the banking industry and re-establish fair and appropriate selling practices. How commissions are awarded, if any, for selling the plan to home buyers must be thoroughly scrutinized to verify that ethical sales practices are being followed from the banking managers on down to the banking associates in the trenches.

One of the bigger banks who have been charged with mis-selling customers in the UK, Lloyds Banking Group has apologized for flogging individual consumers with PPI policies, which were worthless to the consumers.

The banking group promised a large list of solutions to provide for compensating the victims of these mis-sellings, and try to resolve the damage which has been done to the banks reputation.

Lloyds, the UK’s largest PPI seller (estimated 40% market share), admitted in an interview that some of the sale proceeds for PPI insurance policies were flawed, and admitted to unfairly treating customer complaints in the past.

Lloyds has already set aside 2.3 billion pounds in order to repay consumers who were mis-sold on these claims, to cover for the loan payments and PPI insurance policies consumers did not need. Lloyds hopes that this apology will start to earn back their consumers’ trust, and rebuild the company’s stronghold in the industry. Lloyds has promised to pay back all mis-sold policies to consumers, and has promised to change their practices in the future in order to not harm consumers with these mis-sellings in the future. The apology is a start, but they must refund consumers to start rebuilding their credibility.

Claims for PPI compensation from people who had savings or investments in the collapsed financial businesses rose by 25% in 2010-11.

There were 39,500 new claims from consumers to the Financial Services Compensation Scheme (FSCS), according to its annual report.

Some 27,000 of the claims made in 2010-11 were the result of the failure of key data. The investment firm was closed down by the City watchdog, the Financial Services Authority, in 2009. The scheme is expecting a large volume of claims relating to payment protection insurance (PPI) in the coming year, since 20% of the new claims in the last financial year were about PPI.

Some sellers of the loan insurance, which subsequently went bust, have caused the claims.

One important factor driving the bank complaints higher is the continuing upsurge in the number of the mis-selling of payment protection insurance (PPI).

The FSCS has a target of paying compensation to depositors within seven days when a bank, building society or credit union goes bust. The legal requirement is 20 working days.

Thus PPI problems accounted for more than half of the new complaints received by the ombudsman in the second half of the year 2010 and first half of 2011.