Royal Bank of Scotland inviting consumers to buying protection insurance

When customers confirm the receipt of a credit card at RBS; they are being invited to buy protection insurance under slightly dubious pretences. I listened into a call where a call centre operator called Daniel said:

"We notice that you do not have protection cover on your credit card. Did you know that anyone who has your name and date of birth can apply for loans and credit in your name and you will be liable for the full amount?"

Daniel at no point mentioned that he was selling a type of insurance policy until being prompted to by the caller. After some discussion the policy is subject to all sorts of small print that most consumers would not understand. He also did some rather silly scaremongering by suggesting that fraudsters could get passports etc in the name of the caller at the click of a button on a website and generally inferring that the responsibility for poor lending practices is the fault of the consumer rather than the lender. At that point I stopped him.

In the UK, the financial services distance selling rules specifically state that a name and address is required for consumer credit and the act has controls in place so that there is time to reverse a credit agreement. The Consumer Credit Act also has controls in place to ensure that the onus is on the lender to establish the identity of the creditor - crucially, it is not the consumer. The 3 large credit reference agencies in the UK are in business to help their clients do this.

This sales call was bordering on mis-selling of an insurance policy. If you are going to take out such a plan, read the small print carefully and understand your rights.

If you are the victim of identity theft then, get in touch with the credit reference agencies; here is a snippet from the house of commons written evidence:

If Experian has established that an individual is a true victim of fraud and their identity has been fully authenticated, they are provided with the following:

— A dedicated case worker (with a freephone number), who will give general and ongoing advice on identity fraud as well as dealing with the specific problems being experienced by that individual and helping to liaise with lenders on their behalf.

— A free copy of their credit report along with copies of Experian's consumer advice leaflets—Your Credit Report Explained and Identity Fraud Explained.

— A discrete password which is added to their credit report which ensures lenders are alerted to the fact that an individual has been an ID fraud victim and should therefore request the password prior to proceeding with an application for credit.

— Information about and referral to CIFAS (the UK's fraud prevention service) for Protective Registration.

— Free 12 month membership Experian's credit report monitoring service, CreditExpert.