The Financial Ombudsman Service (FOS), which provides consumers with free, independent assistance in resolving disputes with financial services, reports an 18% rise in consumer complaints. The underlying cause of the increase stems from a couple of factors, according to a spokesman from FOS.
Lean economic times tend to make financial institutions unwilling to pay settlements in a dispute, and this refusal just makes for more complaints from consumers. The FOS can demand reimbursement from lenders for loss of funds or poor service, and while finance companies are less likely to be open-handed, consumers are more likely to have a grievance; thus the increased business for FOS.
While in general a little over half of the complaints are arbitrated in favour of the consumer, some companies seem to lose just about every case. Ocean Finance is a well-known company that was found liable in every complaint brought to FOS in the last fiscal period. In the case of Welcome Financial Services, 92% of complaints were found in favour of the consumer. Both companies declined to comment.
MBNA was found liable in 85% of registered complaints; Loans.co.uk, a subsidiary, is no longer trading. MBNA’s spokesman said, basically, that their level of complaints is no worse than their competitors’ and that the percentage of complaints is very small compared to number of customers.
In the big bank category, Barclays had the worst showing at about 65% of complaints resolved for the consumer, but according to a spokesman they are working with FOS to identify the causes and reduce the number of dissatisfied customers.