The Financial Ombudsmen

By: Fred Inance

You may have heard of Ombudsmen's before whereby an independent body resolves complaint and disputes. These have been around for many years.

The Financial Ombudsmen Scheme 2000 provides a service in which 'certain disputes may be resolved quickly and with the minimum of formality by an independent person'. The FSOS aims not to punish firms for doing wrong but to put customers back in the position they would have been should situations not have gone wrong.

As from December 2001 the Financial Ombudsmen has taken over the following;

o The Personal Investment Authority Ombudsmen Bureau
o The Insurance Ombudsmen Bureau
o The Personal Insurance Arbitration Service
o The Office of the Banking Ombudsmen
o The Office of the Building Societies Ombudsmen
o The office of the Investment Ombudsmen
o The Financial Services Authority Complaints Unit
o The SFA Complaints Bureau

The above are now formed into one unit as the Financial Services Authority recognized that having such a fragmented structure of Ombudsmen's operating in different ways was not providing an efficient service across the board and was lacking a consistent approach to dealing with issues. Therefore the Ombudsmen to deal with all of the above now operate as one single Unit. It does however recognize the need for some flexibility when dealing with different types of problems arising from the different areas of Financial Services and so has established three different divisions within the service;

o The banking and Loans Division
o Investment Division
o Insurance Division

What can the Financial Ombudsmen offer me as a Financial Services Customer?

A completely free service! The organization is funded by firms who are a member. Membership is compulsory for all firms authorized under the FSMA 2000.

Customers should make a complaint to the firm concerned first and be dealt with by the firms internal complaint procedure. Once this route has been exhausted and if you as a customer still feel unsatisfied you are applicable to refer your complaint to the Financial Services Ombudsmen Service. Complaint must be made to the FSOS within 6 months of the 'deadlock letter'. This is the letter from the firm stating that they have made their final decision in the case of the complaint.

The FSOS will consult between both the firm and customer involved and suggest a way of resolution. If both parties do not come to an agreement then a formal investigation will commence.
The FSOS can make awards of up to £100,000!

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