Financial Ombudsman Service – definition of ‘eligible complainants’ to be extended?Print publication
The Financial Conduct Authority (FCA) is currently consulting on proposed changes to the rules on complaints handling and customers’ access to the Financial Ombudsman Service (FOS). At present, professional clients under the FCA rules are not eligible to have a complaint about a firm resolved by the FOS.
However, in consultation paper CP14/30 the FCA has suggested extending the definition of ‘eligible complainant’ to include consumers as defined in the Alternative Dispute Resolution (ADR) Directive. If the FCA follows through its proposal, any professional client who was a natural person acting for purposes outside their trade, business, craft or profession would be eligible to complain to the FOS.
Although not especially well-heralded, this change could have a significant impact on firms such as investment managers, wealth managers and fund managers where the investors are professional clients and currently do not have access to the FOS.
The consultation paper also contains other proposals relating to the implementation of the ADR Directive, including removing the right of a firm to withdraw consent it has given to the FOS considering a complaint and reducing the number of grounds on which the FOS may decide to dismiss a complaint without considering its merits.
Elsewhere in CP14/30, key proposals aimed at ensuring the complaints process is more straightforward, transparent and fair to consumers include:
- requiring firms that allow complaints to be submitted by telephone to use free or basic rate lines;
- extending the time period for firms to deal with less complex complaints without the need for a formal letter;
- improving consumer awareness of their right to complain to the FOS; and
- making sure firms report and publish all complaints to the FCA and not just those resolved after the close of the next business day.
The deadline for responses to the proposals in CP14/30 is 13 March 2015.