The Financial Ombudsman Service (FOS) has published its annual review for 2013/14. Points of interest in the annual review include:
- the FOS handled 2,357,374 initial enquiries and complaints from consumers (that is almost 8,000 each working day). Around one in five of the initial enquiries turned into a formal dispute, amounting to a record 512,167 new cases;
- 78% of new cases were about the sale of payment protection insurance (PPI), with the number of PPI complaints increasing 6% to 399,939. Although the FOS resolved more PPI cases than ever before during the year (a record 389,730), it still has around 400,000 to deal with;
- complaints about “packaged” bank accounts more than tripled, while complaints about credit cards decreased by 47%. Complaints about investments and insurance remained at broadly similar levels to the last two years;
- 63% of the total number of cases the FOS dealt with related to four banking groups, while 4,504 financial businesses accounted for only 3% of the FOS’ caseload;
- the FOS resolved a record 518,778 cases, which resulted in compensation for consumers in 58% of complaints. For cases other than PPI, the FOS resolved 44% of complaints within three months. It intends to improve its ability to resolve complaints more quickly over the coming year;
- the FOS received its two millionth case. Whereas it took ten years for one million cases to be referred to the FOS previously, it has more recently only taken three years for a million more to be referred. This has been attributed to a greater awareness by the public of the FOS’ service as well as indicative of the scale of issues involved;
- the FOS is constantly on the lookout for trends that may indicate a cause for concern, and for possible action by the FCA; and
- the FOS recognises that huge developments in technology (such as Bitcoin and FaceTime) create an urgent need for it to review how best it should be shaping its service to respond to the changing needs of consumers and businesses. These developments can lead to changing views on what fairness means, and changing expectations of how quick and responsive the FOS should be.
The FOS intends to publish a directors’ report in a few months’ time.