We now have conclusive evidence banks and other financial firms reject complaints even when they know consumers are in the right.

For the first time today, the Financial Ombudsman has revealed company-by-company complaints data, which shows it often upholds 99% of claims against providers, and it's the Taxpayer-run banks that are the worst (see the Worst Banks Named MSE news story).

And looking at the stats it's difficult not to conclude banks, credit card firms and loan companies use a reject to put ‘em off policy on bank charges, missold payment protection insurance (PPI) and a range of other complaints.

It's likely they're trying to scare people off taking it further by rejecting with pages of cleverly written legalese intimating you've no leg to stand on.

Today's figures show that's nonsense, but before looking, remember one thing before complaining:

Complaints to the Ombudsman must first have been rejected by the company.

Here is how individual companies fare:

Complaints to the Financial Ombudsman by firm (Jan-June '09)
Govt owned? Total complaints Upheld Insurance complaints (i) Upheld
Black Horse Part 1,009 95% 836 99%
Capital One No 1,744 91% 330 98%
Egg No 912 88% 481 99%
Lloyds TSB Part 6,947 81% 3,466 98%
Northern Rock 100% 593 78% 430 98%
RBS Majority 1,812 71% 1,013 94%
Barclays No 8,283 71% 2,085 93%
Abbey No 2,493 67% 236 60%
A&L No 1,786 66% 544 74%
MBNA No 2,298 63% 1,233 99%
Natwest Majority 2,379 60% 582 89%
HSBC No 2,177 60% 621 79%
HBOS Part 5,804 52% 1,227 79%
Nationwide No 1,149 41% 227 63%

Source: Financial Ombudsman Service, (i) Primarily relates to missold payment protection insurance (PPI).

The worst area is PPI

A huge proportion of complaints are in the area of general insurance, and much of these are people putting in loan insurance misselling claims (see PPI reclaiming guide for free template letters).

And it's here we see the most shocking stats: big providers like Egg, Black Horse, MBNA and Lloyds lose up to 99% of cases that get to the Ombudsman.

Therefore, consumers must adopt a simple strategy with the banks from now on: just ignore the protestations that they haven't done anything wrong, no matter what they say, and wait for real justice via the Ombudsman

It's time this ends

The reason the Ombudsman published this data is because it privately tried to shame companies with stats, but that didn't work. However, it's now gone public.

Yet the solution needs to be more robust. If companies are systemically losing at the Ombudsman stage, this must be stopped for one simple reason:

Of three million annual complaints, only 140,000 are reported to the Ombudsman as banks' despicable reject to put ‘em off tactics work.

So either the Ombudsman needs power to issue a collective solution and force companies to stop rejecting cases where it's obvious the consumer will win later on. Alternatively, companies where a substantial proportion of Ombudsman complaints are upheld, must be heavily fined for erroneous complaint handling.

Further reading/Key links

Don’t give up, reclaim now: PPI, Bank Charges, Mortgage Exit Fees, Credit Card Charges, Endowments, Any other financial complaint