The Financial Conduct Authority plans to carry out a thematic review of complaint handling in banks, building societies and insurers, placing greater onus on the role of senior management.
In a speech at a Building Societies Association event this morning, FCA director of mortgages and consumer lending Linda Woodall said “something isn’t working” in the way firms manage and investigate customers’ complaints.
She said the regulator will undertake a review of complaint handling and management in major financial institutions.
Woodall said: “The amount of complaints that go to the ombudsman suggests that something isn’t working in the way in which firms manage and investigate customers’ complaints.
“So…we are going to undertake a thematic review of complaint handling and management in major firms, including building societies.
“The thematic review will identify why complaint handling is not working well for some consumers and address any poor practice within firms.
“We will use our new assessment approach to place greater onus on ‘senior persons’ to understand how effective their firm’s complaints handling process is, and how they use the complaints experience to identify and correct the systemic causes behind customers’ complaints.”
Woodall said the thematic review will be conducted in two phases.
The first phase will consider how firms identify, record and report complaints, and will be completed by the end of 2013.
The second phase, which is due to begin in early 2014, will consider firms’ approach to redress and analysis of the “root cause” of complaints.
The regulator expects to publish recommendations on the back of the review in Q2 2014.
Woodall added: “It is 100 per cent in the industry’s interest to ensure that when customers do complain, they have confidence their complaint will be recognised, that it will be investigated fairly in a timely manner and that redress will be paid where it is due.
“We are hopeful that this will lead to a reduction in the number of customers requiring the services of the ombudsman to obtain the appropriate redress.”
This morning, the Financial Ombudsman Service published the latest data about the businesses it received the most complaints about in the first half of the year.
Lloyds Banking Group once again topped the list, receiving 129,293 complaints between January and June this year.