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Walter Merricks, chief ombudsman

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ombudsman news gives general information on the position at the date of publication. It is not a definitive statement of the law, our approach or our procedure.

The illustrative case studies are based broadly on real-life cases, but are not precedents. Individual cases are decided on their own facts.

ombudsman news

issue 33

November 2003

before we get involved in a complaint

We have recently re-issued our guide for advice-workers [PDF version, opens in new window], a publication for firms that explains our procedures and general approach when resolving disputes. We hope it will be particularly helpful for people working in the parts of firms that deal regularly with complaints, such as compliance units and customer service departments.

The following article is based on part of the guide.

firms’ in-house complaints procedure

The complaints-handling rules set out by the Financial Services Authority (the FSA) require firms to send the consumer a final response – usually within eight weeks from the date the complaint was received anywhere within the firm. In its final response the firm must tell the consumer that they can refer the complaint to us within six months. The firm must also send the consumer our contact details – with a copy of our leaflet, your complaint and the ombudsman.In some cases, eight weeks may not give the firm enough time to resolve the complaint. But it must still tell the consumer, at the end of those eight weeks, that they can refer the complaint to the ombudsman service. It is up to the firm to convince the consumer that it is taking the matter seriously and really does need extra time. The consumer does not have to bring the complaint to us as soon as the eight weeks are up but may choose to do so. If the consumer does bring the complaint to us after eight weeks, and we are satisfied that the complaint has special features which mean the firm clearly does need more time, then we may decide not to look into the complaint immediately. But we do not expect firms to ask us for an extension of time as a matter of routine. If a firm is having problems meeting the timescale set out in the rules for handling complaints, it should speak to the regulator, the FSA, about the possibility of a special rules "waiver".

The FSA’s rules on the in-house complaints-handling procedures that firms must have in place – with fuller details on time limits and other requirements – are set out in the "Redress" section of the FSA handbook. These rules apply now, even if the events complained about took place before 1 December 2001 (when the rules came into force).

firms’ final response letters

If a consumer remains dissatisfied and brings their complaint to us, we usually use the firm’s final response letter as our starting point when we look at the case. In setting out the firm’s view on the complaint, the final response letter should include:

a summary of the complaint;
a summary of the outcome of the firm’s investigation;
whether the firm acknowledges any fault on its part;
details of any offer the firm has made to settle the complaint;
how long any offer to settle the complaint will remain open;
why – if the firm believes this is so – it thinks the complaint may be outside our rules. But the firm should explain that this is a matter for us, not the firm, to decide. And the firm must still tell consumers they have the right to refer the complaint to the ombudsman within six months of the firm’s final response.

complaints-handling dos and don'ts

do...

make sure all relevant staff can recognise a complaint – and know how the complaints procedure works. Be friendly and courteous. Show you understand the complaint and the reasons for it.
apologise or express regret. An apology is not an admission of liability and we won’t treat it as such. You have an unhappy customer and should acknowledge that.
consider what will satisfy the customer and maintain goodwill – and whether it makes commercial sense to settle at an early stage, even if you don’t think the complaint is justified.
be prompt in replying. Try to reach an amicable agreement before attitudes become fixed.
confirm with your customer your understanding of what they are unhappy about – and set out clearly any proposals for resolving the complaint.
use plain English in your letters. Always explain technical terms if you cannot avoid using them.
try to make sure your final response letter can ‘stand alone’ – and does not refer to earlier letters that may not be readily available to the customer. (If you do need to refer to previous correspondence, attach a copy.)

don't

be defensive.
reject the complaint out of hand.
force the customer to escalate the matter to the ombudsman service – or, on the other hand, make it a condition of any offer that the customer gives up their legal rights to come to the ombudsman service.