FOS award limit upped alongside new complaints handling rules
The Financial Services Authority (FSA) has confirmed an increase to the limit on awards made by the Financial Ombudsman Service, from £100,000 to £150,000.
The regulator has also confirmed new complaints handling rules which include:
The abolition of the “two-stage” complaints handling rule to make sure firms resolve complaints fairly and do not dismiss them the first time, requiring persistence from the customer to pursue the complaint;
Requiring firms to identify a senior individual responsible for complaints handling;
Additional guidance to help firms understand the processes they might need in place to meet FSA requirements on root cause analysis; and
Further guidance requiring firms to take account of ombudsman decisions and previous customer complaints.
The FSA’s director of conduct policy, Sheila Nicoll, says: ”Good complaints handling contributes to customer loyalty and should provide the opportunity for firms to put right problems in product design or sales before issues become widespread.”
She adds: “But we have found major failures with the way firms handle customer complaints and have since taken enforcement action against two firms as a result of poor complaints practices.”
Ms Nicoll’s last statement is witnessed by the £3.5 million fine handed down to Bank of Scotland earlier this week, while in April, Royal Bank of Scotland and Natwest were fined £2.8 million for multiple failings in the way they handled customers’ complaints.
Category: Financial Services Authority News, Financial Services Ombudsman, Insurance News
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