The mortgage was taken out in 2006 with the now-defunct Rooftop Mortgages. After rejecting a direct PPI claim by the client, he was contacted by the ombudsman over the matter. Mr Broadbent said he provided relevant information last December, including the mortgage offer letter and his factfind, which clearly stated that the client did not need the PPI.
Ten months later, Mr Broadbent – a campaigner for the regulation of claims management companies and reform of the Fos – was contacted by the ombudsman asking for a mortgage statement and confirmation from his insurance underwriter that no PPI existed on the account.
He said: “Single premium PPI was offered by various insurance underwriters working with a particular lender.
“They are are not my insurance underwriters. How can anyone expect me to know how or who wrote policies for a now defunct lender and why should I have to chase a firm I have never dealt with to give me a letter stating that I did not sell something?”
A spokesman for the Fos said it could not comment on individual cases, however it did expect to see relevant evidence from both parties over complaints. The spokesman added that the Fos received 2000 PPI complaints a day, which may explain the delays in its adjudication process.
This comes as another adviser, Philip Milton, founder of Devon-based Philip J Milton, warned that in his view the Fos was starting to make more findings based on the performance of investment products relative to a benchmark the ombudsman thinks is appropriate.
According to Mr Milton, advisers with whom he has spoken said that where Fos finds against them in cases relating to the performance of an investment, they are required not only to make up the difference to the level of the initial investment, but also to provide an estimated level of return on top of that against benchmarks the ombudsman deems suitable.
He said: “I have written to the Fos saying I do not think a complainant should profit from a complaint, they should be restored to their previous financial situation.”
He pointed to statements on the Fos website, which claim: “What if we think the consumer would have invested differently?”, and based on qualities the ombudsman thinks the possible alternative investment may have had, the ombudsman will tell a “financial business to use a measure, usually a published benchmark or index, that would broadly reflect how the money might have been invested”.
Robert Morris, partner for City law firm Reynolds Porter Chamberlain, said: “The Fos is increasingly a bold judge, and it is very difficult for firms to prove a negative as in this case.
“Our sense is that Fos is very much aware of its importance to the industry, and is asserting its jurisdiction.”
Adviser view
A spokesman for Fos said: “When we deem that an error has occurred or that the advice given was not appropriate the ombudsman will seek to put the consumer into the position they would now be in if the original problem hadn’t occurred, based on what we think would most likely have happened at the time. This will vary from case to case and consumer to consumer.
As for relevant qualifications, we provide extensive and ongoing training to all staff to ensure that they have the relevant knowledge to investigate their particular cases, whether these are investment, banking or PPI cases.”
