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1,000 Complaints a month for Sesame

Company claims the cost of managing deluge of cases will be 4m this year

Sesame is seeing an explo- sion in complaints and is now getting 1,000 a month.

The company says that managing the complaints will cost it around 4m this year, with the average case costing between 350 and 1,000, equating to 5 per cent of gross annual inc- ome for 200 of its worst-hit member firms.

Chief executive Patrick Gale says although many cases relate to endowments, consumers’ propensity to complain is increasing in all categories.

Endowment complaints upheld have risen from 18 per cent to 21 per cent in the last six months for Sesame.

By comparison, another big network says it receives around 80 complaints a month, with around 80 per cent relating to endowments.

Sesame is set to overhaul its monitoring function for business records and will be conducting endowment complaint-handling cour- ses this year in an attempt to stem the flow.

It is also lobbying Aifa, the FSA and the Retail Financial Services Forum about equalising the complaint process, which it says fav- ours consumers, as well as pushing for the regulation of claim management firms.

Gale says: “We are man- aging over 200 instances where companies are fac- ing costs representing, on average, 5 per cent of gross income.

“We can only anticipate a rougher year as time- barred red letters fully kick in. This represents the toughest environment that many advisers have seen for years.”

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