Litigation Solicitors - Financial Ombudsman Service - FOS Complaints

SOLICITORS HELPLINE: ☎ 0344 414 0017

During the 1980's and 1990's a new phenomena hit the UK financial services market relating to the sale of unsuitable investments by over zealous or in many cases dishonest salesmen. This scandal which continues to affect millions of people causes very substantial lost capital and income became known as financial products mis-selling and mainly related to mortgages, high income bonds, investments and private pension schemes. These shortfalls have resulted in compensation being paid following a Financial Ombudsman Service (FOS) complaint and where the provider cannot make redemption, an application by a Financial Ombudsman Service solicitor to the Financial Services Compensation Scheme (FSCS) may result in payment of damages for pecuniary loss.

The Financial Services Authority (FSA) regulates the financial industry in the UK. Disputes regarding financial services are now resolved either in the law courts by solicitors or through the Financial Ombudsman Service complaint scheme. In addition The Financial Services Compensation Scheme administers a fund of last resort.

In most cases the modus operandi of the salesman was very similar in that an allegedly much improved product was offered with higher income or increased final capital and customers were persuaded to move their investment from one product to another. What the salesman often omitted to tell the customer was that they received very substantial commission on the deal and that the capital sum was to be invested in the stock market and was no longer guaranteed.

Whilst the stock market continued its upward trend, by the end of millenium there was stagnation of share prices or in many cases there was an actual reversal meaning that capital funds were often much reduced when compared to the original investment. This resulted in capital losses to the majority of investors and a reduced pension for those who contracted out of the rock solid government SERPS scheme.

The reasons why a financial product may be deemed to have been mis-sold are many and varied however some of the most common grounds supporting a solicitors Financial Ombudsman Service complaint are outlined below :-

  • The salesman did not carry out a fact find with the investor to determine the most suitable forms of investment based on the investors personal circumstances.
  • There was no discussion about how the money was to be invested, the investors attitude to risk and the fact that the capital sum may decrease.
  • Alternative investments more suitable to the investors needs were not proposed or discussed.
  • The risks associated with early termination were not clearly outlined and the investor was not told that domestic financial products are usually long term investments.
  • Misleading information was given about the stability of the fund and assurances were made that effectively guaranteed the value of the fund.

Financial Ombudsman Service

The Financial Ombudsman Service was set up by statute in order to help settle financial disputes that occur between businesses in the financial sector and their customers who purchase their products and services. Use of the FOS arbitration procedure is free to consumers however many chose to be represented by a solicitor.

The Financial Ombudsman Service will only get involved after a member of the public has made a complaint direct to the firm which was not dealt with to their satisfaction. At first instance the firm has the option to settle the complaint there and then by making an offer of financial compensation. The consumer has the right to reject any offer from the firm if they consider it unsatisfactory. In cases where no responsibility is accepted on the part of the firm or where the purchaser deems any offer to be inadequate, a complaint letter can be sent to the FOS.

The Financial Ombudsman Service is expected to be impartial in these disputes and to reach a fair conclusion based on the regulations and the law. Every case is different and is treated as such. Once a formal written complaint has been sent to the FOS they will evaluate the situation and then make a judgment which is binding on the firm but it is up to the consumer whether or not they accept that judgement and if not they are still at liberty to take the issue to court. If the consumer accepts the judgement it is binding on both parties (regardless of whether the financial firm accepts it or not). These disputes are typically settled via financial compensation.

Our solicitors deal with FOS compensation claims for investment bond, mortgage, pensions mis selling. Why not get expert support to improve your chances of securing the maximum compensation you deserve using our no-win no fee* service? We call upon experienced lawyers, accountants and actuaries to assist our claims team and can advise at an early stage on the prospects of recovery of compensation. If you would like free advice on our no win no fee* compensation scheme just complete and send the contact form or call the helpline and an experienced financial claims adviser will discuss your potential claim at no cost and with no further obligation.

SOLICITORS HELPLINE: ☎ 0344 414 0017

*legal information

Claims for compensation for financial products can be made directly to the Financial Ombudsman Service or to the Pensions Ombudsman and no fee is payable.
You do not have to instruct a solicitor to represent you and if there are no complicated issues it may be to your advantage to claim directly.