The Financial Ombudsman Service (FOS) is an impartial and independent body designed to settle disputes between consumers and financial service providers.
The body was created in 2001 from the Financial Services and Markets Act 2000, and is funded through levies and fees placed on companies regulated by the FSA or Office of Fair Trading (OFT). It is free for consumers to use the ombudsman.
The FOS aims to provide fair and balanced service to settle disputes, in as timely a manner as possible and with minimal formality. The body also tries to help the consumer return back to their original financial position and ensure that decisions are upheld by the relevant financial positions.
Information taken into account before making a decision includes:
- Codes of Practice
- The standards and guidance of regulators
- Standard practice of the time
- Any laws that are applicable
70 per cent of all complaints referred to the FOS are related to PPI, with thousands more cases referred each day.
The sheer volume of complaints means that the FOS has had to spend years sorting through all cases, with many more to come.
Customers who aim to refer a case to the FOS often have a number of questions, such as:
What’s happening with PPI complaints?
It is estimated that around £50bn worth of PPI policies have been sold over the last couple of decades, with millions of people having already claimed. However, there are still billions left to claim and as such, it will take years to process the remaining claims.
How do I make a PPI complaint?
Firstly, you will need to contact the lender with whom you’ve made a financial agreement to ensure that you were mis-sold PPI, and provide as much information as you can in order to make a complaint.
You should receive a response from your lender within 8 weeks, with compensation received shortly after if agreed upon.
If your complaint is rejected, and you don’t find the reasons to be adequate, you can refer your case to the FOS.
What will the FOS do?
The FOS will review your claim from an independent standpoint and decide whether your claim is valid or not, maintaining impartiality throughout its review and explaining any decisions to you.
The FOS has the power to overrule a lender’s decision, and actually decides in favour of the consumer in around two out of three cases.
The FOS is receiving record numbers of complaints, with more than 500,000 PPI complaints already received. Each of these needs to be properly assessed, so it may take a long time.
How long will it take to resolve the complaints?
As nobody knows exactly how many people have PPI complaints, it is difficult to gauge how long it will take for them all to be processed; current estimates believe it will take years.
Fortunately, not all cases will take this long because many are sorted in a matter of months. The length of time it will take to resolve your claim will depend on a number of factors, including how easy it is to find all the necessary paperwork and how straightforward the facts of the case are.
The FOS tries to see all cases as quickly and effectively as possible, and will usually give an indication as to the likelihood of your claim being upheld quite early on.
However, they will not be able to give a detailed timetable for your case.
What should I do while my claim is ongoing?
Once you have referred your complaint to the FOS, there is nothing more to do. The body will contact you once progress has been made.
However, this rule does not apply if your circumstances change drastically, such as if you were to move house, for example, and must inform the FOS.
Will other complaints be affected by PPI complaints?
The FOS has specialist teams for each area, and these will not be affected by a PPI complaint as they are managed separately.