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FOS cases up 20% year on year to nearly 200,000
Consumer complaints received by the Financial Ombudsman Service in its 2023/24 year rose by 20% year on year to reach nearly 200,000, the FOS said today.
There were 198,798 new complaints in the 2023/24 year compared with 165,149 the previous year.
A sustained rise in case numbers could lead to an increase in costs for the Ombudsman and a rise in industry levies for the next financial year.
Abby Thomas, chief executive and chief Ombudsman, said that the indications so far were that the rise in case numbers was continuing into the new financial year.
She said: “It’s always concerning when you see cases rise so significantly, particularly when so many people are struggling in the current economic climate.”
On average, across all financial products, the Financial Ombudsman Service upheld 37% of the complaints it resolved, slightly higher than the 35% recorded in 2022/23.
Financial advisers saw 305 complaints made about their advice on investment portfolios between 1 April 2023 and 31 March 2024.
However, of the 98 decisions reached by the Ombudsman, only 34% were upheld, below the average uphold rate.
DB transfers continued to be a frequently claimed about area.
There were 344 new cases regarding DB transfers to a SIPP between 1 April 2023 and 31 March 2024. The Ombudsman reached a decision in 174 cases, with 71% of complaints upheld.
There were 703 new complaints registered with the Ombudsman regarding DB transfers (not to a SIPP) in the 2023/24 financial year. Of these 535 cases saw a decision, and 67% of complaints were upheld.
Overall there were 1,460 new complaints to the Ombudsman about SIPP products. These also had a higher than average uphold rate with 62% of the 755 decisions reached by the Ombudsman having the complaint upheld.
Increasing numbers of complaints were being brought by claims management companies and professional representatives. They accounted for 25% of cases in 2023/24 compared to 18% in the prior financial year.
The Ombudsman said it had seen examples of good and bad practice from professional representatives. Some representatives had submitted mass claims without determining whether they have merit, while others failed to respond to requests for evidence, slowing down the Ombudsman’s investigations.
In recent months, the Ombudsman has been consulting on a proposed case fee for professional representatives, aiming to make the fee model fairer and better reflect the costs. Under the proposals, professional representatives would be charged up to £250 to bring a case, reduced to £75 if the case outcome is determined in favour of the consumer.
Fraud and scam cases rose by a fifth to their highest level, with 27,312 complaints in the 2023/24 financial year. Around half of these cases were authorised push payment (APP) scams where someone is tricked into sending money online to a fraudster posing as a genuine payee.