Financial advisers have criticised the Financial Ombudsman Service’s understanding of the issues on which it adjudicates, claiming that key people there lack industry experience.
Panacea Adviser, the online financial advisory community, carried out a survey of IFAs that attracted 183 responses, looking at Fos and the adjudicators.
When asked: “Do you believe that adjudicators and the Ombudsman have a solid industry understanding of the issues they adjudicate on?”, 78 per cent said no, 15 per cent were unsure and 7 per cent said yes.
In one comment, an IFA said: “Failing to understand some of the complexities of the complex products under discussion is key. Failing to distinguish between losses arising from poor advice and those from malfeasance on the part of managers/administrators is a critical example.”
When asked: “Do you think an adjudicator should have relevant experience and minimum industry qualifications at least?”, 93 per cent said yes, 4 per cent were unsure and 3 per cent said no.
One respondent said: “They need to be trained as to what was acceptable advice at the time it was given. “There is no requirement for a judge to be a qualified surveyor before he adjudicates on property disputes, so I remain to be persuaded that all Fos staff need financial qualifications.”
Respondents to the survey also showed alarm about being targeted by “false” claims for compensation. When asked: “Have you experienced false or manufactured accusations from complainants in an attempt to gain compensation?”, 74 per cent said yes and 26 per cent said no.
Some 58 per cent of advisers believe that Fos adjudications are generally not fair. One adviser said: “Fos probably believes that the adjudications are fair, but it does appear that ‘fairness’ is generally centred on the client, rather than applied across both the client and regulated firm.”
A Fos spokesperson said: “We continue to work with the adviser community to help improve their understanding of the ombudsman’s approach when dealing with complaints.”
To download the full survey results with all the comments for free, please visit www.panaceaadviser.com/fossurveyresults