Financial advisers are just as likely to be reported to the Ombudsman by other financial businesses as claims management companies, the Financial Ombudsman has revealed.
According to a FOS spokesman, the complaints often arose when specialist mortgage and investment advisers looked over a client’s financial history and spotted an apparently unsuitable product sold by another broker.
He said: “Advisers really care about the advice that is given to people. What seems to happen is you go and see another mortgage broker or independent financial adviser and they will look at your finance and say ‘That isn’t suitable at all’. They bring the complaints on behalf of the consumer.”
By contrast, claims management companies targeted larger businesses such as banks, he said.
The FOS was responding to concerns from businesses that it was encouraging ‘spurious’ claims by ‘chancers”.
In the latest edition of Ombudsman News, it stated: “For cases involving IFAs and smaller businesses, as many disputes are referred to us by other financial businesses as they are by claims managers.”
Four out of ten requests for the ombudsman to make a financial decision came from financial businesses, it said.
And of the total 120,000 complaints resolved last year about financial products other than payment protection insurance, it dismissed fewer than 1% as ‘frivolous and vexatious’.
More than 5,000 complaints each year come from smaller businesses, the FOS estimated.
It said ‘chancers’ was not a fair description of the majority of people making complaints and it was reasonable to investigate complaints where consumers thought they might have had PPI but were unsure.
Nor would it take up suggestions to charge claims management companies for bringing complaints, on the grounds this would cost consumers and would not address any of the underlying controversy surrounding PPI.
