At one time the Financial Ombudsman Service was where consumers were taking complaints when they needed a quick decision in a dispute with a UK firm. Now however they are turning to the media because the FOS is so overwhelmed with a backlog of cases that it is often taking as long as 2 years for each case to be reviewed and resolved.
As an example, the Guardian was recently contacted by a couple from Somerset who had waited longer than one and a half years for the FOS to review the complaint they had submitted against Liverpool Victoria. What Guardian found out was that even though the dispute was only over £625, the FOS said it would still be several weeks before that claim came up for review.
According to the report, literally thousands of UK consumers have been waiting for two years or longer for a review of their claim against a company they felt acted unethically or who treated them unfairly. Sometimes thousands of pounds are involved and after having waited a period of years for a resolution, consumers are turning elsewhere for help. It is felt that a speedier resolution would have been possible in small claims court.
On the other hand, the FOS claims that consumers who are in ‘financial hardship’ will be pushed up the ranks to the head of the queue while everyone else needs to wait in line. The irony in this is that the FOS was established for the sheer purpose of providing a quick and inexpensive method of dispute resolution between consumers and financial institutions.
While there is no fee being charged to consumers, the FOS does charge £500 to the company for each complaint filed against that firm. Apparently the overwhelming number of PPI claims being filed against lenders for mis sold payment protection insurance has overburdened FOS to the point where all claims are being held up as well. Even with 300 new handlers being hired, PPI has put the FOS over the edge and it does not look as though the caseload will lighten up any time soon.
