Intermediaries and the Financial Services Authority (FSA) have rejected reports by the Consumers Association (CA) that avenues of complaint for mis-sold endowment mortgage products are insufficient.
The CA and Which? magazine said it had only found one in six consumers with an endowment mortgage who felt the FSA was doing enough to tackle their problems.
Sheila McKechnie, director for the Consumers’ Association, said: ‘The FSA has committed the worst crime of all, it is guilty of complacency and arrogance. It has clearly failed to listen, understand and communicate people’s rights to compensation. As a result, millions of consumers will be badly let down on this issue. The FSA can no longer afford sit on its hands over the issue of endowment mis-selling. It must take effective action now to enable victims of mis-selling to get more information and claim compensation.’
But intermediaries have questioned the amount of mis-selling involved and suggested falling markets may be behind the rash of complaints that have been seen.
Jim Gillespie, director for adviser Independent Financial Services, felt that nine out of 10 times products had been sold properly and the implications of the product and costs involved explained.
He said: ‘You have to take the rough with the smooth and that is explained to people when they take out the products.’
A spokeswoman for the FSA rejected the claim that consumers had no access to vehicles of complaint. She said when policy re-projection letters began to be sent out in April this year the FSA’s factsheet on making complaints was included.
She said 23 firms were actively compensating consumers and although it was unfair to say the market had played host to blanket mis-selling.