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Aifa vexed that Hunt didn’t take review further

Aifa has criticised Lord Hunt’s review of the Financial Ombudsman Service, claiming it should have recommended oral hearings and a fee for consumers who submit vexatious claims.

Director general Chris Cummings says he was expecting a more comprehensive review of the FOS and is disappointed that Lord Hunt did not go further in his recommendations.

Cummings says: “All these recommendations will come at a cost and we must be aware of where the funding will come from. We believe Lord Hunt should have accepted our calls for the introduction of oral hearings. The lesser step of a pilot of facilitated meetings in the early stages of complaints is welcome as it will be used to test the difference that a hearing makes. The decision to introduce oral hearings should be reconsidered at the end of the pilot.”

Cummings welcomes Lord Hunt’s call for claim-chasers to be charged a fee for submitting vexatious claims but says this should be extended to all complainants.

He praises the recommendation that the FOS should provide clear figures on how much compensation a firm should pay, rather than a formula.

Cummings says: “This is an improvement on the curr- ent system of just providing a formula for claims. At least we will have the true figure of the amount of compen- sation awarded by the FOS and know who the main culprits are.”

The Association of British Insurers says it supports Lord Hunt’s recommendations for greater transparency and case fees for vexatious complaints via claim-chasers but says an external appeal process is needed.

An ABI spokesman says: “The FOS’s decisions can have far-reaching consequences. We are therefore disappoin- ted that Lord Hunt dismisses the idea of an external app- eal process.”

Hunt review, p30, 31

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