Financial Services Compensation Scheme  

FSCS chief questions 'unauthorised actors' as scams predicted to rise

She said: “I have spoken recently about the challenges we have in this space with our compensation limits. FSCS's limit of £85,000 for financial advice is far below the £355,000 that the Ombudsman can award if they uphold a complaint.”

In the year to March 2021, for pensions advice, customers lost over £104m on valid claims that the FSCS was not able to put back into their pockets purely because of the limit. 

This 'uncompensated loss' came to an average of £108,000 per person - and often occurred at a time when they were close to the age they had hoped to retire, with little time to recover this gap between limit and loss.

This type of claim has increased 26 per cent year on year for the past four years, and Rainbird argued that now is the time to look at the limit again and re-examine whether it is still appropriate for the future.

She added: “I'm not sure I could talk about 2021 without mentioning how working habits have changed, undoubtedly accelerated as we continue to experience the impact of Covid-19. 

“FSCS started to return to the office in the summer, after over a year away due to the pandemic. We have now settled on a smarter working pattern that works for us and are using our '5 C's' - connection, collaboration, creativity, compassion and celebration - as the drivers for spending time together in the office.”

During this period of remote and now hybrid working, she said the FSCS has “achieved a great deal” such as record customer satisfaction, strong people engagement scores and successful projects including the launch of the London Capital & Finance compensation scheme on behalf of the government within just a few months.

“I am extremely proud of how our teams have supported each other and delivered amazing things whilst getting used to a new rhythm in their working lives,” she said.

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