MPs are lining up their promised review of the Financial Ombudsman Service, with the focus on making sure those charged with the investigation stay independent from the adjudication service.
Writing to FOS chief executive Caroline Wayman, Treasury select committee chair Nicky Morgan notes that a provisional terms of reference had been drawn up, but stressed that the reviewer appointed by the non-executives at FOS must be “demonstrably independent.”
Morgan writes: “Conflicts of interest, or perceptions thereof, will undermine public confidence in their work”.
Morgan adds that FOS should provide the review with access to all documents and staff it requires, suspending normal processes such as the deletion of historic records where necessary, so that it can judge whether any failings are down to management action or inaction, cultural factors, staff objectives and performance management or organisational structure.
In the correspondence released yesterday, Wayman says that the FOS had agreed to the proposed timetable and noted the need for an independent reviewer. MPs on the committee are due to see the report at least two weeks before parliament’s summer recess, with the reviewer to give evidence ahead of the break.
The review comes after a Channel 4 documentary earlier this year where insiders expressed fears that some FOS staff were “churning out” cases due to a lack of training.
There were also allegations that some adjudicators were biased against complainants in favour of large financial services firms.