Despite the turmoil surrounding financial regulation, some features still remain a mystery.
Basically a satellite organisation of the City regulator, Fos and its army of adjudicators seem to operate in a parallel universe to that of most financial advisers and even consumers.
First, they take ages to even acknowledge a complaint has been made and given the way the tripartite regulatory regime – the FSA, FSCS and Fos – there is no logical reason why there cannot be an enforceable period in which they should be forced to acknowledge complainants’ concerns. For most of us, a reply within five working days stating that the complaint has been received and will be further dealt with within a given period would be fine. Such a holding letter would at least tell the person that their complaint is in the system.
The alternative to that, of course, is one is left waiting for weeks wondering if the letter had gone astray within the bowels of Canary Wharf.
Second, and most important, it is still not clear where Fos recruits its adjudicators, what qualifications they must have, what training they undergo, and the status of their findings.
From all evidence, it appears as if the adjudicators carry out their ‘inquiries’ in a rather casual way and, in reaching their conclusions, instinctively lean towards the provider, be it a bank or life office.
There is no apparent formal way in which complaints are adjudicated, apart from the dedicated adjudicator contacting the named provider then making a subjective assessment.
Even the appeal system seems haphazard, inviting the aggrieved party to notify the same adjudicator within four weeks or so of any intention of appealing against the original decision.
Even when the adjudicator finds that the provider has not treated the customer fairly it some times refuses to order them to make right that wrong. Of course, in this quasi-judicial function, Fos is obliged to be objective and fair in its assessments and to weigh the evidence impartially, but with an element of secrecy in the way it operates, it takes some convincing that this is the case.
But as long as a complaint to Fos is heavily weighed against the complainant, rogue providers will always take a gamble on complaints.
Learning a simple lesson
Last week the chairman of the US Federal Reserve, Ben Bernanke, gave a major speech on financial education, followed this week by a Which? statement on the same subject.
That the consumer group and the leading financial regulator should be singing from the same song sheet is very interesting.
For years we have been saying that to push financial education further up the media’s agenda the chancellor or secretary of state for education will first have to appoint a dedicated junior minister with a remit to cover the subject.