International Network of Financial Services Ombudsman Schemes

Effectiveness

a fundamental principle for a financial services ombudsman

Fundamental principle

There should be:

  • a clear definition of what constitutes a complaint
  • clear obligations on financial services businesses to deal with complaints fairly and promptly.

A financial services ombudsman scheme should:

  • have a flexible and informal process (where parties do not need professional advisers)
  • have skilled decision-makers
  • be properly resourced.

Effective approaches

Obligations for financial services businesses

What constitutes a complaint is clear and documented.  For example:

  • whether it can be any oral/written expression of dissatisfaction
  • whether it has to be a formal complaint in writing.

Financial services businesses within the financial services ombudsman scheme’s jurisdiction are required to:

  • have an accessible, effective and fair internal complaints process, which is published
  • issue a written response to a complaint, with reasons, within a specified time
  • tell complainants that, if they are still dissatisfied, they can go to the ombudsman scheme
  • have a single person with overall responsibility for the handling of complaints
  • respond promptly to communications from the ombudsman scheme
  • provide information and documents requested by the ombudsman scheme
  • comply promptly with the ombudsman scheme’s decisions.

Informal and flexible process

The financial services ombudsman scheme has an informal and flexible process, so that neither party needs a lawyer or advisor (though parties are not prohibited from using a lawyer/adviser if they want to).

The financial services ombudsman scheme:

  • handles enquiries, to resolve some problems before they turn into full-blown disputes
  • takes an active role in deciding what evidence is required and calling for it
  • obtains expert reports when these are necessary
  • uses informal mediation to reach a fair settlement, where this is possible and appropriate
  • issues a formal decision in complaints that are not settled.

Information, advice and training

The financial services ombudsman scheme assists early resolution of complaints by:

  • publishing details of its approach to common complaints
  • giving advice to consumers and financial services businesses
  • helping train consumer advice centres and financial services businesses’ complaint departments.

Knowledge and skills

Financial services ombudsman scheme decision-makers:

  • have the necessary knowledge and skills in resolving complaints
  • have a general understanding of law
  • have knowledge of relevant financial services
  • are appropriately trained.

Financial services ombudsman resources

The financial services ombudsman scheme is:

  • adequately staffed
  • adequately funded
  • efficient, and
  • cost-effective

  so that complaints can be effectively and expeditiously investigated and resolved. 

© Copyright INFO Network 2007 - 2022