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62% Of advisers say scrap fees for innocent firms

Nearly two-thirds of advisers want to scrap case fees for firms found innocent of complaints and are prepared to pay more if found guilty, according to a Money Marketing poll.

The survey gauged advisers’ views on two alternative funding proposals which were rec-ently tabled by the Financial Ombudsman Service.

The FOS is asking firms whether they would prefer a new model to replace the current funding system which imposes a levy and charges a £360 case fee for firms after an allotted two free cases, even if the adviser is found innocent.

Sixty-two per cent of IFAs voted in favour of only levying case fees from guilty firms, which would push fees up to over £1,000 a case but spare innocent firms.

Only 13 per cent of advisers want to scrap case fees alto-gether and pay a 100 per cent levy despite warnings of spiralling levies caused by rogue firms using the ombudsman as a cheap way of outsour- cing complaints.

Twenty-five per cent of firms opt to stick with the much criticised current system.

Aifa director general Chris Cummings: “It goes against the grain of justice for firms that are completely innocent to have to pay a hefty fee. We are consulting with our members.”

IFG Financial Services financial planning strategist Donna Bradshaw says: “A higher case fee for guilty firms could also act as a preventive measure against misselling.”

FOS spokesman David Cresswell says: “It is reassuring to see firms engaging with the decision-making process.”

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