The Financial Ombudsman Service (FOS)
If you thought the FOS were independent think again
The FOS is a “complaints handling” service
According to their website – their “customers” are firms, financial and otherwise!
I have a few issues over at the FOS, and they are not being handled properly (in my opinion). So I made a few Freedom of Information requests and this is what I found out. Decide for yourself whether these guys act for you – independently of their “customers” (firms).
This is how the FOS works, any firm can pass a “complaint” to the FOS for handling, this usually takes place after 8 weeks if the “firm” is unable [OR UNWILLING] to resolve a complaint. The matter will then be referred to the FOS, and you will be invited to write out your complaint again on FOS forms. (This will naturally deter a percentage of people).
The FOS is a private arbitration Court/service; their decision is binding on the firm. But it is NOT binding upon you!
For having access to the FOS, each firm will pay annual fees + each firm will pay approximately £450.00 per case referred to the FOS.
In relation to credit and finance, the industry funds the FOS complaints handling service. This means “conflict of interest” – allow me to demonstrate.
During 2010/2011, Santander paid £7 million to the FOS in case handling fees, these are complaints that years back, Santander would have to resolve itself?
During 2011/2012, the FOS received £151.9 Million in fees from firms (Big Business) and they made a profit in excess of £20 million! But wait for it… what about the staff…? Surely if there was a conflict of interest staff would be well paid…? Right? The FOS Board consists of non-executive directors and these guys met just 11 times during 2011/2012 for which they get paid on average: Chairman – £74,970 in fees, committee chairs/senior independent directors £26,265 and non-executives £21,420. Gwyn Burr, Director at Sainsbury’s Bank is one of these non-executives – and they call that “independent”? The Executive team owners follows for y/end Natelie Ceeney (CEO) £236,444
Tony Boorman £262,503
Julia Cavanagh £292,290
David Creswell £137,993
Caroline Wayman £163,230
Jacqueline Wigget £138,136
David Thomas £69,511
Simon Rouse £105,951
this includes lucrative pension plans
Adjudicators receive an average of £47,000 pa – the job description was enclosed in the FOI. However, there are NO RECORDS as to how many are legally qualified!
Of the 222,333 complaints received during 2011/2012, more than 157,000 were PPI related, however, PPI has already been ruled on so why is there a need to refer so many complaints to FOS?
The FOS proudly announces that including PPI claims more than 64% of consumers receive compensation – no shit – but removes the PPI complaints and that figure falls dramatically to around 30%! No actual pound amounts in close!
The Police do NOT investigate claims of fraud committed by banks and financial firm. They refer people to the FOS. The FOS, however, as confirmed by FOI does NOT refer suspected fraud cases to the Police! And the FOS maintains NO RECORDS of such cases!
Executives at the lucrative expense account too! Salary banding for staff are as follows:
7 x Executives on £115K – £185K
75 x ombudsmen, lead ombudsmen, managing ombudsmen on £58,807 – hundred and £12,267!
38 x heads of dept, senior managers on £55K – £107K
128 x managers on £26K – £56K
1048 x case handlers £24.5K – £56K
123 x helpline staff on £28K – £34K
152 x casework staff on £16K – £52K
110 x support staff £18.5K – £51K
and you’re telling me there is no conflict of interest?
The FOS is a business! It serves firms, it is NOT in the interests of the FOS, or staff to screw its customers (firms). It is however, in the interests of the FOS to screw you and send you on your way, with the belief that an “independent” body has passed “Judgment” – this is NOT the case!
The FOS can award up to £150K in damages and demand that the waiver of any balance. However – it does NOT keep records of specific financial awards…. (strange that). But the FOS does keep records of trips and falls, of which there were 6 in 2011/12 and 41 incident requiring attendance by a first aider!
During 2011/12, an independent assessor received £75,804 for a 3 day week, plus pension contributions of £10,892 and other benefit of £2035.
The non-exec team earned £269,246 between them – but hey – they did have to meet up 11 times – so come on, be fair! Well earned I say, haha!
So what can we glean from this information….. the FOS is a complaints handling business. Its customers are firms who wish to offload complaints to the FOS. The FO F gives the appearance of an “independent” body but it is NOT independent! It serves the needs of its customers (firms).
Payment Protection Insurance Claims have already been decided on by the Courts, hence why were 157,000+ PPI claims referred to the FOS @ £450 a pop? Answer – mutual benefit. When firms demand complaints in writing a percentage of consumers (us lot) will not bother. By referring complaints to the FOS a further percentage of consumers will not bother filling out more forms. And then the FOF plays a balancing game by serving the needs of its customers (firms) versus what is lawful, just balance and fair………. sweet!
95% of all complaints came from the BIG 4 Financial Groups, of which Gwyn Burr works with one – Bank of Scotland (via Sainsburys Bank!).
For further reading regarding this, you can watch the rest of the video below.
I would like to thank:
for allowing me to publish the text version on my site.