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Complaints about financial products soar

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17/07/2013
The Financial Ombudsman Service (FOS) received 179% more complaints in Q2 2013 than Q2 2012.
Complaints about financial products soar

The service received 159,197 new complaints in the three-month period compared with 57,076 in the same period last year, according to its latest figures.

Payment Protection Insurance claims again made up the bulk of all complaints with more than 132,000 claims received between April and June this year. This represented 83% of all consumer gripes – up from a comparatively low 56% last year.

Coming in third with 2% of all complaints, mortgages stayed level at about 3,000 complaints referred to the FOS in the period and a similar uphold rate to last year.

Over the whole of last year the product attracted about 12,000 referrals, 26% of which were upheld. However, pensions and guaranteed bonds saw significant drops in their complaints figures.

Personal pensions were complained about 330 times in the period, which marks a significant fall compared with their latest full year statistic of 1,808. What’s more, only 25% of complaints about pensions were upheld in the quarter, their smallest fraction since at least 2010/11, when it was 36%.

Self-invested personal pensions also saw a drop, with 132 complaints – compared with 620 in the whole of last year – and a lower hold-up rate of 55%, compared with 61% last year.

Complaints about guaranteed bonds returned to their 2011/12 level of 88 per quarter, after having spiked last year at 580 complaints. This time round, however, only 20% were upheld, unlike 35% two years ago.

The FOS said its job of adjudicating had been made more difficult by allegations of corrupt complaints such as the Lloyds scandal earlier this year.

The service itself had come under fire from the Association of Professional Financial Advisers which claimed it was handling complaints inconsistently.

Chief ombudsman Natalie Ceeney said the claims and allegations on all sides were “distractions that don’t affect the fundamentals of what the ombudsman is here to do.”

She added: “We take nothing at face value. We’ll continue to challenge bad practice in complaints handling.

“And we’ll continue to focus on the specific facts of each individual complaint – and to approach things problem by problem, case by case.”

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