about this issue of
ombudsman news

by David Thomas
principal ombudsman banking & loans division

This is the first ombudsman news to focus on the work of the banking and loans division, and we start with a bumper edition. Future banking and loans editions will appear every three months. We hope that banks and building societies (which will have to get used to being called ‘firms’ – the term used in the new rules) will find ombudsman news a useful source of reference – not only on how to handle complaints but also on how to avoid complaints arising.

The banking and loans division currently resolves cases in the names, and under the rules, of the Banking Ombudsman Scheme and the Building Societies Ombudsman Scheme. So far as rule differences allow, we aim to harmonise the treatment of complaints – to ensure consistent protection for consumers and a level playing field for the industry.

At present, the Financial Ombudsman Service is receiving over 5,500 banking and loans enquiries each month, and handling 2,000 new banking and loans complaints. Over 40% of the complaints currently relate to mortgages – principally early repayment charges, pre-Financial Services Act mortgage endowments and mortgage underfunding. Over 20% of the complaints currently relate to savings accounts – a proportion swollen by the recent focus on TESSA interest rates.

This issue of ombudsman news reflects these concerns, concentrating mainly on mortgages and savings accounts.

We also look at a range of other matters including:

• account mandates – and what happens when joint signatories fall out;
• some issues relating to the use of plastic cards; and
• cross-border complaints and complaint-handling.

In addition, we summarise the modifications we are making to our case-handling procedures as we prepare for the new regime. I am sure you will appreciate, as I do, the hard work which members of the banking and loans division and the communications team have put into preparing this publication. Please let us know if you have any suggestions about how we could make it even more useful.