FOS expected to scrap extra PPI case fee

clock

The Financial Ombudsman Service is expected to scrap its fee of £350 for mis-sold payment protection cases after amassing "considerable" funds since the fee's introduction in April 2012.

The fee is charged to the lender or the broker, depending on which party the complaint relates to, in addition to the standard £550 case fee - only after 25 cases have been submitted to FOS relating to the same firm.

A source confirmed to Mortgage Solutions that the not-for-profit organisation "has built up a considerable amount of money" by applying the fee which is intended to mitigate the cost of additional staff and systems required to handle the volume of complaints.

If the broker is an appointed representative of a network the network is responsible for paying the fee.

Sally Laker, managing director of Mortgage Intelligence, said: "If this is indeed the case and the fee is to be scrapped this is good news for us and all the other networks."

Laker said that it is often the case that PPI complaints are "spurious".
She added: "A lot of claims are labour intensive which is why a fee is charged but then it ends up resulting in a complaint which is not upheld. It is an expense for brokers and networks so if this does happen it is a good move by the ombudsman."

Nick Baxter, independent chairman of the Professional Financial Claims Association, said: "Anything which reduces the overall cost of independent third party adjudication has to be welcomed."

FOS declined to comment on the supplementary case fee ahead of the release of its budget later this week.

More on Regulation

FCA chair: Name and shame plans 'valid' despite 'stern reaction'

FCA chair: Name and shame plans 'valid' despite 'stern reaction'

Ashley Alder was speaking at a Treasury Committee hearing

Cristian Angeloni
clock 09 May 2024 • 4 min read
Trade bodies call for chancellor to stop FCA public enforcement

Trade bodies call for chancellor to stop FCA public enforcement

‘Proposals to publicise investigations are a worrying development’

Isabel Baxter
clock 29 April 2024 • 2 min read
Johnny Timpson criticises DWP's vulnerable customer practices

Johnny Timpson criticises DWP's vulnerable customer practices

Calls for DWP’s approach to be brought in line with regulated sectors

Jaskeet Briah
clock 26 April 2024 • 2 min read

Highlights

COVER Survey: Advisers damning of protection insurer service levels

COVER Survey: Advisers damning of protection insurer service levels

"It takes longer than ever to get underwriting terms"

John Brazier
clock 12 October 2023 • 5 min read
Online reviews trump price for young people selecting life and health cover

Online reviews trump price for young people selecting life and health cover

According to latest ReMark report

John Brazier
clock 11 October 2023 • 2 min read
ABI members with staff neurodiversity policy nearly doubles

ABI members with staff neurodiversity policy nearly doubles

Women within executive teams have grown to 32%

Jaskeet Briah
clock 10 October 2023 • 3 min read