Introduction

In the last investment edition of ombudsman news, I looked forward to reviewing the impact of N2 – the implementation from 1 December 2001 of the Financial Services and Markets Act 2000. Our aim was that the transition would be as seamless as possible and that the following months would be ‘business as usual’. It is early days – but to date we seem to have achieved this ambition.

As we move through 2002, our procedures and approach will continue to develop and to be reported in ombudsman news. Increasingly, we will be looking to firms to submit files or relevant papers promptly, when first asked to do so. Regrettably, although many firms are very cooperative, some cause undue delay. As we look at the impact of the requirement under the new rules to treat customers fairly, we can anticipate situations where we will not delay our investigation until we have a firm’s papers.

We will also be seeking to identify and progress the cases we can deal with without the need to obtain further papers – for example – where we are familiar with the product literature and/or issues involved, or where the customer has sent us all the paperwork necessary for us to start our investigation. In such instances, we will naturally tell firms that we are looking into the complaint and they will have the opportunity to make representations and submit evidence before we resolve the matter. But, where appropriate, we will be placing increasing reliance on what the firm has done during its in-house consideration of the complaint, and on what it has told the customer in its final decision letter.

In this edition of ombudsman news
The last banking and loans issue of ombudsman news (December 2001) provides much helpful information for all firms wanting to learn more about our new procedures. To supplement this, we reiterate some of the basic principles of complaint-handling. This article should prove particularly helpful for firms that were previously regulated by the SFA, for whom N2 has brought a fundamentally different complaints arrangement. However, I hope it will be a useful source of reference for all firms.

In this edition we also discuss:

• sales made before ‘A Day’ – 29 April 1988, when the Financial Services Act 1986 was implemented;
• our approach to mortgage endowment cases that involve policies enhanced by windfall benefits, while we await the guidance promised by the regulator in its Regulatory Update 94 (RU94); and
• our approach to evaluating awards for non-financial loss.

As usual, we include case studies to demonstrate our current thinking on these topics, together with a roundup of some of the many different investment complaints we have dealt with in recent months.