On 15 August 2018, the FCA published a webpage providing the findings of its review of how non-deposit taking mortgage lenders and mortgage third-party administrators handle complaints.
The findings of their review are as follows:
- firms generally have a positive attitude towards complaints root cause analysis, however it isn’t always clear how firms use their management information to deal with underlying reasons for complaints;
- complaint handling operations varies among firms. Some firms look to follow the FCA rules with a tick-box compliance approach, while not fully appreciating the effect on customers;
- there is an over reliance on policies and processes in some firms. The resulting tick-box approach to complaint handling can limit staff’s ability to exercise judgement and put customers’ interest first leading to potential harm to customers; and
- some firms aren’t effectively applying lessons learned from determinations by the Financial Ombudsman Service.
The FCA has set out a number of key messages for firms moving forward, these include that they should:
- have robust root cause analysis capabilities to identify and remedy any recurring systemic problems;
- ensure the management information firms collect and analyse (including for root cause analysis) is accurate and relevant to its operations;
- establish and maintain effective and transparent procedures for the reasonable and prompt handling of complaints;
- make sure complaints are assessed fairly, consistently and promptly;
- make sure that firms’ internal systems and controls allow staff to identify and record complaints correctly and accurately; and
- have processes in place to make sure the data in its FCA annual or biannual complaints return is accurate.