Financial services complaints down 42%

There was a 42% fall in the number of complaints received by the Financial Services Ombudsman in 2014, according to its annual review.

There were 4,477 complaints made and 3,166 of these were closed by way of a formal investigation.

Some 45% of complaints closed during the year involved some form of redress for the customer.

In its annual report, the ombudsman attributed the sharp drop in complaints to its new policy of encouraging complainants to engage with financial service companies to agree a resolution before he investigates.

The ombudsman has long sought to have the powers to publish the complaint record of financial service companies as it would vastly improve the complaints management process, it said in the report.

The ombudsman has been partially granted this power and published in its annual report the number of complaints that have been upheld and partially upheld against individual firms.

However, individual case studies are still reported on an anonymous basis. Mortgage products are the single biggest driver of complaints, accounting for 28% of all complaints.

Investment product complaints have fallen 65% from 770 cases in 2013 to 271 last year.

Banking complaints fell by 27% from 2,925 in 2013 to 2,127 in 2014. Complaints about insurance products fell by 495 from 3,835 to 1,955 over the same timeframe.

“In 2014 we are pleased to see evidence that the changes introduced by the financial services ombudsman in 2013 — regarding publishing the complaint records of individual financial service providers and facilitating engagement between the providers and their customers — has had a significant effect on the complaint handling by the industry,” said financial services ombudsman Bill Prasifka.

“More complaints are being dealt with at an earlier stage in the process and settled; and this is a very positive outcome for customers. However some issues such as mortgage complaints remain a concern and more work remains to be done,” he said.

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