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FOS accused of ‘churning out’ cases with ‘no training at all’

A Channel 4 documentary has revealed further allegations of a lack of training and bias among adjudicators at the Financial Ombudsman Service.

In an undercover investigation by the Dispatches programme, investigators express fears that “some people have just been thrown in with no training at all.”

An investigator tells the undercover reporter: “There were people there who had no idea, no idea about any products, anything about complaints at all.

“Bear in mind I’ve been doing this now a year and a half…even now I look at an investment case and I don’t know what to ask for. Sometimes I’ve not even heard of the products I have to Google what it is first.”

The investigator adds that in pension complaints the customer often has a greater level of knowledge than FOS staff.

They say: “You’ll find that 99 per cent of the consumers are so invested in their own complaint that they know way more about the product than even you do.”

Fairer Finance managing director James Daley says: “These are complicated products and any adjudicator or ombudsman that’s involved in arbitrating on decisions needs to know that subject area inside out.”

Other insiders spoken to by the programme say they were “churning out” decisions and that “legitimate claims were being missed, rushed through”.

Dispatches also uncovered cases where payments for distress and inconvenience were not calculated based on any formula, but just by taking an average of the guesses of a team.

In one meeting, senior ombudsmen appear biased against payday loan complainants and those who claim to been the victim of debit card fraud.

In a statement to Dispatches, FOS says: “The impression given is clearly not representative of us at our best. Our people are committed to doing the right thing and we always want to know how we can improve. We are determined to provide the best support for our staff, and a fair and trustworthy service for our customers.”

Former pensions minister Ros Altmann called on the Government to launch an inquiry into the allegations.


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There are 12 comments at the moment, we would love to hear your opinion too.

  1. I’ve been wittering on for over 10 years about how the FOS is not fit for purpose. To the extent that some have told me to shut up.

    The fact that there is no independent appeals process and that the system is used by CMCs and opportunists as a free ‘let’s try it on’ avenue shows that it is broken.

  2. There is little surprise that the less scrupulous investment firms, particularly in the Sipp market have made hay through a total disregard of the regulation and at the expense of their clients.

    It’s the lure of easy money that has a very strong appeal………

  3. It seems, from some cases I have heard of, that FOS has not been fit for purpose for many years and a lot of advisers have paid penalties they should not have, for the sake of benefiting quite a few fraudsters among the public.

  4. Having watched Dispatches last night, it seems pretty clear that the principal drain on the FOS’s resources is the tanker loads of rejected PPI complaints with which it’s simply overwhelmed and on which it still has a chronic backlog. Were it not for this, the FOS might well be able to allocate more towards the proper training of its staff. Questions:-

    1. Given that such a high proportion of such sales are, sooner or later, found to have been unsuitable, on what basis are so many complaints about them being initially being rejected, only later to be upheld? Is this not of concern to the FCA? And

    2. Why, having published good practice guidelines, did the FSA (on Hector Sants’ watch) turn a blind eye to the banks ignoring these guidelines and indulging over many years in an industrial scale orgy of mis-selling?

    3. As head of the organisation at the very centre of this investigation, why were these questions not put to Caroline Wayman? Did not the makers of the programme think to do this or was their request for Ms. Wayman to appear declined?

    Whichever way you look at it, the root of the problem appears to have been regulatory negligence on the part of the FSA. Will anyone be held to account?

  5. The industry has often called for FOS adjudicators to hold relevant qualifications. FOS response is that they only need a legal background. Seems their staff have neither and rely on google instead. It’s ridiculous that advisers have to have level 4 qualifications and adjudicators none at all!

    • Yet if you look at the FOS website it is not only adjudicators who have no legal qualifications. Furthermore, I would have thought as the complaints are about financial services accountants would be better placed to judge the validity or otherwise of those claims.

  6. I really don’t think there is any major surprise ..we all know it, and it’s a pity it’s now highlighted by a TV investigation

    More negative news for the industry that just taints us all.

    We know that this problem spreads right across not only FOS but the FCA and the FSCS

    What arrogance to push standards up to the industry then refuse point blank to look at yourself in th mirror.

  7. There is a need not only for an enquiry but re-dress and compensation for those claimants whose cases were badly handled and where there is more than clear evidence of bias both by adjudicators and ombudsmen. One of the major flaws in the whole FOS system is that there is no right of appeal against a “final decision”. However perverse it may be the complainant has no choice but to accept the ombudsman’s ruling often where there is not been full disclosure by the financial institution involved and evidence provided rebutting any defence offered by that financial institution.

    • You seem to be inherently biased towards the complainant in your post.

      Personally I am dismayed at the treatment of both genuine complainants and the industry. Only if the FOS tries to be truly impartial and the adjudicators are knowledgeable about what they are deciding on, can there be any hope of the right decision being reached.

      However you only seem to be concerned about one side of the equation, maybe perfectly demonstrating the issue. Bias…

  8. Whilst I do not think you need masses of knowledge or training to understand or adjudicate on simple insurance, bank accounts, deposits etc. How on earth are people supposed to come to unbiased fair decisions, when they both know nothing about the products/how they work, and do not know or ignore the relevant law?

    Many years ago, I did actually apply to work for the FoS and was very surprised at the time that they didn’t even want to know what my skills or qualifications were from a technical aspect.

    They also paid peanuts and what do you get when you pay peanuts?

  9. 80% of claims are likely to be fraudulent especially as FOS has no policy for fraud screening, they just process them. Target driven for sales and bonuses.

    If adjudicators can’t handle simple PPI and pay day loans, how the hell can they adjudicate on pension and investment products? Simples, they can’t. This includes the so called Ombusdman,they are just as bad as most come from failed other industries.

    Come on lets have an independent audit on the FOS and see what the results are?

    Wet behind the ears youngsters handling major decisions on long term complex products. An X-FOS adjudicator who came to work with me post FOS as she was disgusted the bad quality of work, when she left because she had had enough, she was gagged too. What a lovely democratic corrupt country we live in eh!

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