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FOS could revamp rules on IFA negligence claims

The Financial Ombudsman Service is reconsidering its rulebook following a Court of Appeal decision last week which left IFAs singled out for pursuance of negligence claims into their retirement.

Reversing an earlier decision on professional indemnity insurance, the court put back the 15-year limitation for professional liability for all professions except IFAs which are excluded under FOS rules.

Under the FOS rules, which replaced the PIA Ombudsman&#39s rules in Nov-ember, IFAs can be pursued for negligence claims until they die.

The Court of Appeal&#39s U-turn came in the case of solicitors Cave

Robinson Jarvis & Rolfe.

The ruling had prompted Aifa to call for IFAs to be brought in line with other professions, which the FOS says it will consider.

Aifa director general Paul Smee says: “It does seem that the rules have not been carried over in the same form as the PIA Ombudsman&#39s rules. We think this is an error in the drafting of the rules rather than a deliberate act. It is something that we are taking up with the ombudsman.”

Solicitors Reynolds Porter Chamberlain partner Jonathan Davies says: “This week&#39s judgment re-establishes the principle for all except financial advisers.”

Independent Financial Services director Jim Gillespie says: “This compensation culture is a worry to me as it is the poor IFA who is left to carry the can. Hindsight is a wonderful thing but it should not be used as a stick to beat the IFA.”

FOS spokeswoman Iris Baker says: “We are in the process of considering the impact of this decision on the time limits we apply.”


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