This includes introducing a registration stage at the FOS before a complaint proceeds to a full investigation. It said 81% of respondents agreed to this change in its first consultation, saying it would “improve complaint quality, reduce unnecessary referrals and discourage speculative cases”.
The FCA said the ability to pause or pass cases back at a registration phase would improve firms’ ability to manage mass redress events or regulatory issues. It also said the idea aligned with the government’s plans for handling mass redress, and its plan to go forward with its proposal to allow the FCA to pause complaints at FOS to determine whether a regulatory response is required.
The proposed model will include a ‘pre-registration stage’, where early assessment and information gathering are carried out, then a ‘registration stage’ where the full investigation begins.
During the pre-registration stage, a case’s readiness will be determined, as well as whether there is sufficient evidence.
Amendments to the dismissal grounds have also been put forward, such as instances where a complaint is “frivolous or vexatious” or a complainant has “acted vexatiously, abusively or otherwise unreasonably in engaging with the Financial Ombudsman Service”.
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To improve predictability, consistency and certainty, the FCA and FOS are looking at ways to work collaboratively, ensure the FOS understands FCA requirements and applies them consistently.
The regulators will also work to make the FOS’ approach to resolving cases more transparent, in line with the government’s plans to publish quarterly thematic guidance and how relevant FCA standards are applied to cases.
The consultation will close on 11 May.
Final guidance on identifying and rectifying harm has also been published, an outcome of the previous consultation.
James Dipple-Johnstone, interim chief ombudsman at the FOS, said: “The financial sector has changed significantly since the Financial Ombudsman was set up 25 years ago, which is why we are driving forward changes to transform the redress system. We are laying the foundations for an agile, responsive and modern service which is fit for the future and has the confidence of consumers and firms alike.
“Building on improvements we have delivered already these new measures will further modernise our operations to ensure we remain a service [that] keeps pace with a changing sector in delivering our vital service for consumers and supporting confidence in UK financial services.”
Sarah Pritchard, deputy chief executive at the FCA, said: “We want a system that delivers fair compensation fast, while providing greater certainty to businesses so they have the confidence to invest, grow and compete.
“We’re acting at pace to change what we can within our current powers, ahead of the government’s wider reforms.”
