The ABI is concerned over the definitions of non-disclosure between the FSA and the Financial Ombudsman Service, in light of the recent announcement the FSA and the FOS will be consulting on complaint handling by the ombudsman.
It fears that a company could find it complies with FSA rules but be on the wrong side of the FOS.
ABI FOS liaison group spokesman Nick Kirwan say he hopes the relationship between the two organisations will help them to identify the differences.
The FSA interprets an act of non-disclosure as either innocent, negligent or fraudulent. The FOS guidelines define non-disclosure as either innocent, inadvertent, clearly reckless or fraudulent. The ABI would like to see a tighter definition.
ABI head of health Richard Walsh says: “The ABI will be holding discussions with the FOS, particularly with a view to understanding precisely and interpreting non-disclosure.”
Kirwan says: “I must stress that we salute the efforts of the FSA and FOS to review regulatory action and especially whether some decisions by the FOS should be subject to some sort of external appeal process. However, the categories of non-disclosure need a simplicity of language that the consumer can understand. For example, a definition like 'your fault, my fault, shared fault' would make more sense.”
FOS press officer Iris Baker says: “We would give all that matters in practical input on the issue.”