On 3 April 2023, the Financial Ombudsman Service (FOS) published a feedback statement on its proposals to make temporary changes to outcome reporting in its business-specific complaints data.

The consultations

In October 2021, as part of its work on reducing its existing backlog, the FOS consulted on a temporary initiative to amend how it records proactively settled cases that meet certain conditions. The consultation was well received by stakeholders, with many respondent businesses feeling that the change should be adopted permanently to resolve cases quickly and as early as possible.

On 6 March 2023, the FOS published a further consultation paper setting out proposals to create, as a trial for the 2023/24 financial year, a separate category in the FOS’s business-specific complaints data to record complaints resolved by a fair and reasonable offer from a business within 14 days of the FOS requesting the business’ complaints files as ‘proactively settled’.

The outcome

As a result of the feedback received, the FOS will proceed with a slightly modified initiative for the 2023/24 financial year, which will see it report cases as ‘proactively settled’ where the following criteria are met:

  • The initiative only applied to complaints on which the FOS i) requests the business file on or after 1 April 2023 (and on/before 31 March 2024); or (ii) requested the business file less than 14 days before 1 April 2023.
  • Within 21 days of the FOS requesting the respondent’s file, the business may offer to settle the complaint, but the FOS must be clearly informed within 14 days that an offer is coming.
  • If the FOS receives an offer from a financial business within the 21 days, it will review the offer to determine if it is fair and reasonable. If the FOS believes it is, it will share the offer with the complainant. If the FOS does not think it is fair and/or reasonable, it will inform the parties that this is the case and that it intends to investigate the complaint as normal.
  • If the complainant accepts the offer, the complaint will close and be recorded as ‘proactively settled’. If the complainant declines the offer, the FOS will begin investigating the complaint as normal and the usual ‘change in outcome’ or ‘no change in outcome’ will apply.
  • If the FOS reviews the complaint and finds the offer fair and reasonable and the customer accepts its initial findings, the FOS will record the outcome as ‘proactively settled’.

The FOS will continue to engage with financial businesses as to its expectations around this initiative, as well as general observations under the DISP complaints handling rules, and closely monitor how the initiative is utilised. It will also work with the FCA to share how it is monitoring business behaviour under this initiative and look at what data and insight it can share.