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MM Leader: FOS lost its way with prize day

The concept of a National Complaints Day offering an iPad for the best complaint is the sort of event you would associate with a claim-chasing firm looking to drum up some cheap publicity.

In fact, the day, reported in last week’s Money Marketing, was promoted by the Financial Ombudsman Service.

Incentivising consumers with a glittering prize to complain about firms encourages the growth of a dangerous kind of complaint culture that does nobody any good.

Although there were many examples of endowment misselling which required compensation to be paid out, firms were also hit with an avalanche of unwarranted complaints which cost a huge amount of time and effort to resolve.

Many of these complaints where whipped up by claim-chasers and the growth of a culture where consumers were encouraged to “have a go” and complain as they have nothing to lose.

As an independent service for resolving disputes between financial firms and consumers, the FOS needs to promote itself to the masses to ensure people are aware they have someone to turn to if they feel they have been ripped off and the firm does not agree.

But in promoting this day and the associated prize, the FOS has crossed the line from independent arbiter to complaint-generator.

The only encouragement anyone should need to complain is the belief that they have been missold and the desire to get their money back.

This iPad prize trivialises an important route for consumers to get compensation from firms, takes the focus off the goal of receiving appropriate compensation due to misselling and encourages an unhealthy complaint culture.

It appears very naive for the organisers of the day to claim that offering the iPad prize was not an attempt to stimulate complaints. Surely, the prime purpose of offering a prize is to get more people to enter the “competition”.

The prize has hit a very raw nerve with many IFAs who have suffered financially from frivolous complaints made against their firm by consumers who had been encouraged to complain without real justification.

At a time when the FSA is debating with the industry the rights and responsibilities of everyone involved in the buying, selling and advising of financial products this prize really does send out a terrible message.

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Comments

There are 2 comments at the moment, we would love to hear your opinion too.

  1. Last week called and wants its news back.

  2. A clear, fair and not misleading lack of impartiality.

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