Yesterday we wrote to the new Interim Chief Ombudsman raising a number of key concerns (see attached letter from the FLA and a number of other consumer credit TA’s).

 

The letter specifically raises concerns around:

 

  • The extended 7-week implementation period between announcing CMC charging and it coming into force on the 1 April,
  • The effects of this extended period,
  • Problems with the new CMC Portal which is not being properly policed and therefore letting through unfounded complaints lacking evidence, and
  • The financial effects of these failings.

 

In conclusion, we urge FOS to convene a meeting and invite the FCA to join, so that the full implications can be assessed, and the remainder of the seven-week implementation period can be managed satisfactorily.

 

We have already started compiling evidence of poor CMC practices around these practices but would welcome any further feedback directly related to these issues raised in this letter. For example, what products and issues are giving rise to your concerns? And volumes etc. We can then feed this intelligence back to FOS’s current Chief Ombudsman.

 

It’s also worth noting that in response to some of these concerns raised in late January, we have had the following email (dated 24 Feb) from Richard West, Ombudsman Director Mass Claims. It would be interesting to know if this response correlates with members current experiences of dealing with FOS (refer below):

 

“Thank you for your email of 30 January, which has been passed to me, about the possibility of high volumes of motor finance commission (MFC) complaint referrals in the coming weeks.

 

I can confirm that we will not take on MFC complaints made to firms after 26 October 2024 which are subject to the pause and so fall outside our jurisdiction, unless the firm has issued a final response.  (Question: Is this members experience?)

 

For complaints made before 26 October 2024, where the firms have had longer than permitted by the regulator to issue a final response (if non-DCA) or to explain to the consumer that the complaint is subject to the pause (if DCA), we are currently working with both the third-party representatives and the firms involved to ensure that any cases referred to us meet required standards and to encourage the firms to act to identify pause affected complaints to avoid unnecessary referrals to us. We understand that a number of firms are now working with the third-party representatives to that end.  

 

If, however, we see examples of poor representative behaviour, we will continue to refer those matters to the FCA and SRA as appropriate.  And I would invite your members to share details of any specific examples of poor practices they see, as that will assist us in preparing any referrals. 

 

As James Dipple-Johnstone set out in our letter of 14th August 2024, and as is still the case today, unfortunately, many firms still do not make it clear, by or at the point of referral to FOS, whether the complaint is a relevant motor finance DCA complaint subject to the original DCA pause. If the firm fails to do so, then the complainant can refer their complaint to FOS at any point after the 8-week period elapses, and such a complaint will be a “chargeable case” as set out in FEES 5 of the FCA Handbook. We do provide some reasonable flexibility on this – so if a firm gets back to us very quickly then we do not raise a fee; but where we do have to do work on the case then we will charge the fee”.

automobilemag.co.uk
Automobile Magazine UK

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