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The UK monetary ombudsman introduced on Friday it will begin charging claims administration firms for bringing circumstances solely a day after its chief government give up unexpectedly, having clashed with its board over the plans.
The Financial Ombudsman Service, which resolves shopper complaints towards the monetary providers sector, mentioned that from April it will cost claims administration firms £250 for each case they create past the primary 10 annually. This is able to fall to £75 if a declare is profitable.
The change is designed to handle considerations that “there may be little industrial incentive for representatives to make sure the complaints they create are well-founded or have benefit”, the FOS said.
Solely 26 per cent of circumstances introduced by skilled representatives succeeded, it mentioned, in contrast with 38 per cent of these introduced instantly by customers.
The change is more likely to be welcomed within the Metropolis of London, the place executives have complained about “ambulance chasing” claims managers pursuing spurious circumstances. Customers will nonetheless be capable of refer complaints on to the ombudsman without spending a dime.
Nonetheless, representatives of “no-win no-fee” authorized teams have warned that the brand new prices could also be “weaponised” by monetary teams to discourage customers from bringing real circumstances to the ombudsman.
The FOS announcement got here solely hours after it mentioned Abby Thomas had stepped down as its chief government, with out explaining why she was leaving.
One individual aware of the matter mentioned the ombudsman’s board was pissed off at her preliminary reluctance to begin charging claims administration firms.
Thomas didn’t reply to a request for remark and the ombudsman declined to touch upon whether or not there had been a boardroom rift over the introduction of charges.
