Advisers have slammed claims by FCA technical specialist Rory Percival that differences between the regulator and the Financial Ombudsman Service are a “myth”.
Speaking at an Institute of Chartered Accountants of England and Wales conference this week, Percival said the issue of FOS decisions which go against FCA rules is often raised with the regulator.
But he said: “I am not convinced that the incidence of these differences is as significant as is often made out.
“When I talk to people about cases that have supported that view, the difference isn’t necessarily there. I think messages can get round and people can interpret adjudications to take a wider view.
“There is the potential for the myth to have been built up and I am unconvinced that this is as much an issue in reality as it is in perception.”
Informed Choice executive director Nick Bamford says: “I have seen several instances of FOS decisions which are inconsistent with FCA rules, one of which where the adjudicator failed to understand the rules on unregulated collective investment schemes.
“The FCA should recognise that FOS decisions are made by people without our qualifications and often with little understanding of industry issues.”
Philip J Milton & Company managing director Philip Milton says: “To say this scenario does not exist is naïve. The FCA should have the power to look at questionable FOS decisions.”
Percival also said that shorter and more personalised suitability letters could help advisers defend complaints to the FOS.
Earlier this month, Percival said suitability letters were too long and geared towards defending complaints rather than client engagement.
He said many advisers have since argued they need to include lengthy information because of the FOS.
But he said: “If your letter is personalised to the individual client, that is going to be contemporaneous and personal information that the adjudicator will look at. A lot of adjudicators are getting reports that are generic, however, and in those situations it is easier for them to find in favour of the client.”