Criticism
- Timeliness - In the ten years since the ombudsman service was created, some consumers, businesses and commentators have suggested that the ombudsman takes too long to look at some complaints. In previous years, the ombudsman has seen complaints about some topical financial matters take longer to resolve that others (notably, mortgage endowments and payment protection insurance (PPI) due to the sheer volume of complaints received by the service. The ombudsman's most recently published annual review (2010/11) shows that half of complaints were sorted out in three months or less (47%) and three quarters (75%) in 6 months.
- Questions as to their impartiality due to the manner in which they're funded and the financial services, the fact that 35% of the Ombudsmen are solicitors who have often worked for the financial firms and/or career civil servant backgrounds of their board. Though the ombudsman service currently upholds over 60% of complaints in favour of the consumer, there have been complaints that the awards are inadequate.
- As an ombudsman's decision is the final stage in the service's process, consumers who remain unhappy would need to pursue their complaint through the court.
- 15-year long-stop: There is no 15-year "long-stop" rule in the complaints-handling rules made under the Financial Services and Markets Act and the Consumer Credit Act. In its policy statement published in January 2003 - and following subsequent reviews - the Financial Services Authority (FSA) set out why there is no 15-year limitation period in the complaints-handling rules, stating: "We do not consider it is in the interests of consumers to rule out the possibility of complaints being dealt with outside the 15-year period that would apply to court cases. Nor do we consider this necessary to prevent hardship to firms."
Read more about this topic: Financial Ombudsman Service
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