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MoJ warns claims firms on ‘irresponsible’ FOS chasing

Claims firms are acting “irresponsibly” by chasing the Financial Ombudsman Service for updates on payment protection insurance complaints, says the Ministry of Justice.

In a bulletin to claims firms published this week, the MoJ says some firms are sending routine, scheduled requests to the FOS for updates on complaints.

It says these are unnecessary and will cause delays to the service.

The MoJ says: “Many of these enquiries are being made before deadlines for financial businesses to respond and timeframes for making payments to customers have expired.

“Such conduct is irresponsible and a potential breach of the rules. Claims firms should provide information about the process and timescales in order to manage clients’ expectations but should only chase progress from the FOS in exceptional circumstances when such action can be justified.”

The MoJ also issued a reminder to claims firms that some firms are still failing to deal with complaints made against them by telephone.

It says: “Enforcement action will result if you insist that clients put their complaints in writing and/or fail to treat complaints made by telephone in accordance with your complaint handling procedures.”

In a separate bulletin on marketing, the MoJ warns a number of claims firms are failing to provide accurate information about their services when telemarketing to consumers.

It says in some cases, firms tell customers they will undertake a “financial review”, when in fact they only provide PPI misselling claim services.

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Comments

There are 5 comments at the moment, we would love to hear your opinion too.

  1. Neil F Liversidge 4th June 2014 at 9:39 am

    We who pay FCA, FSCS and FOS fees are paying for this. A simple solution: 1. Make claims firms pay towards FOS by submitting a full case fee up front with every claim they file. 2. Put them on a £1 per minute premium rate phone line for any calls they make to the FOS. 3. Charge them on a £50 a time for any written chases. No accompanying cheque and the letter goes straight in the bin. Bingo – problem solved, i.e. far less ‘chancer’ type claims, less interruptions for the hard pressed FOS staff and a contribution to the FOS budget from those who make money out of exploiting the system. How much longer will the powers that be sit with their heads in the sand?

  2. Sitting with their heads in the sand?

    Are they contortionists?

  3. Perhaps if FOS were not taking two years to deal with even the simplest of claims, they would be chased less often ?

    The primary reason that there are so many cases at FOS is the appalling way in which the Banks deal with complaints in the first place. The reason why CMC’s re chasing cases is that Banks are effectively ignoring FOS – in some cases taking over a year to provide case files.

    Whilst I disagree Neil’s view that CMC’s should be charged for phone calls and letters (as it is ultimately the consumer who would end up paying), as I have often said on these forums, I am more than happy for the FOS case fee to be raised substantially, to say £2,000 and for the losing party to pay this. This would discourage claims without merit and also encourage lenders to do a proper investigation in the first place. This would hopefully lead to a slimmed down FOS and sufficient funds to enable all the FOS adjudicators to be taken to Diploma qualification level

  4. Exasperated Me 4th June 2014 at 1:37 pm

    Some claims firms keep their clients up to date using a secure web site, why can’t the FOS do the same for complainants? Is it too much to ask? The FOS is like a black hole where things go missing for month on end.

  5. I can understand your reasoning CMC Manager but do you not think a £2,000 fee for the loser will put consumers off trying for themselves?

    That said, I have just seen an adjudicator explicity say it was “entirely suitable” for a cautious investor “to move into and out of the markets”.

    So I suppose we are both agreed that FOS staff lack competence.

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