The FSA has started enforcement action against two firms following its investigation into the way companies handle complaints about unauthorised overdraft charges.
In a letter to the chief executive officers of firms which provide current account services, FSA managing director of retail markets Clive Briault says that in “some firms it found significant deficiencies and important areas of weakness in their approaches to handling complaints about unauthorised overdraft charges.”
The FSA noted concern over a failure to respond to these complaints fairly and consistently; adequately to address the subject matter of complaints; or to ensure complaints are resolved at the earliest possible opportunity.
Briault says that some firms’ complaint handling processes are so protracted, incremental and iterative that they do not appear to comply with FSA rules.
It also found that some firms are delaying or impeding complainants from having complaints registered or assessed, or claiming complaints are being resolved to the complainant’s satisfaction, when in fact they are not.
The FSA says there were examples of unfair closure of accounts, or threats to do so. Some firms are using, or threatening to use, their contractual right to close customers’ accounts in a manner the FSA says it would regard as an unfair effort to ‘punish’ the consumer for having complained, and inhibit them, and others, from complaining in the future.
The regulator also claims there was evidence of false or misleading statements to complainants.
Briault says: “In light of these various findings, the senior management of all firms that operate current accounts need to review their firms’ complaints handling procedures to ensure they comply with out standards, which include handling complaints fairly.”