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Financial complaints double over past year

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The number of new complaints taken on by the Financial Ombudsman Service (FOS) almost doubled over the past year, figures show.
Financial complaints double over past year

The Ombudsman said it is handling 508,881 new cases in 2012-13 – up 92% on the previous year – from a total of more than two million consumer enquiries.

Payment protection insurance (PPI) complaints rose 140%, but there were also steep rises in gripes about investment-linked products (42%), mortgage endowments (43%) and pensions (27%).

The organisation, which is due to publish its annual review later on Wednesday, credited consumer’s growing understanding of their rights for the rising numbers, and said it was disappointed at companies’ failures to resolve problems early.

Chief ombudsman, Natalie Ceeney, said: “We have seen a much stronger consumer voice in the last year – with people becoming more aware of their rights and less willing to put up with poor customer service.

“As levels of confidence in financial services have eroded, it is disappointing that we still haven’t seen any significant improvement in complaints handling.

“Too many financial businesses still seem unable to sort out problems themselves, without the ombudsman having to get involved.”

Payment protection insurance (PPI) made up the bulk of complaints (74%) having also doubled in numbers, to 378,699, over the past year.

Consequently, banks fared particularly badly in the review and almost two thirds of complaints (62%) reaching Ombudsman stages involved four of the UK’s largest banking groups, whereas they accounted for a slightly smaller portion (52%) of cases last year.

Across the UK, the number of formal disputes rose from one in five enquiries received by the FOS to one in four, from which 49% complainants received compensation.

Ceeney said:”With complaint numbers doubling, this has been another challenging year for the ombudsman.

“And if customer dissatisfaction remains at these record levels, the challenges we face are likely to continue for the foreseeable future.”

FOS new cases

PPI: 378,699 new cases, up 140% on 2011-12
Current accounts: 19,560, up 34%
Mortgages: 11,920, up 25%
Unsecured loans: 7,809, up 25%
Investment-linked products: 4,697, up 42%
Mortgage endowments: 4,657, up 43%
Pensions: 4,401, up 27%
Other banking services: 3,838, up 30%

Source: FOS 2012-13


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