When Barclays tried to flog PPI to Lord McFall

The payment protection insurance (PPI) debacle has been one of the biggest cases of mis-selling in history, but this story shows just how ambitious some bank advisers selling the policies were...

Lord McFall of Alcluith, former chair of the Treasury Select Committee (TSC) and head of the Workplace Retirement Income Commission (WRIC), has revealed Barclays tried to sell even him some PPI.

McFall has a long history of pointing out high charges, excessive pay and opacity in charges in financial services.

Last summer his WRIC report called for a cap on charges in pension funds, and in November he criticised the £350,000 salary of the chief executive of the Money Advice Service.

McFall said he crashed his car after he had been elected MP for West Dunbartonshire in 2005.

He approached Barclays for a £12,000 personal loan to buy a replacement vehicle.

"I did not actually need the loan as I had an overdraft facility, but that was my fault," said McFall.

"I said, ‘how about this loan?' and the bank adviser said, ‘have you ever thought about taking out some PPI?'

"I said, ‘well, I've just been given a guaranteed job for the next five years, so no,'."

McFall also said the Financial Conduct Authority (FCA), which will replace the Financial Services Authority (FSA) this year, must have sufficient powers of intervention.

He said his experience on the TSC had taught him that the industry often knows about a brewing crisis far earlier than regulators.

"When Northern Rock went down, people came to us and said if we had come to the market they could have told us to do something earlier," he said.

"I am keen to give the FCA power to intervene. It needs to have a proactive approach."