MSE News

Spike in financial complaints revealed by FSA

Guy Anker

Deputy Editor & Head of Operations

29 October 2009

The number of complaints about banks and other financial firms has risen to over 1.5 million during the first half of 2009.

In particular, there has been a massive spike in gripes from consumers angry about the misselling of debt insurance, known as payment protection insurance (PPI).

Figures released today by city watchdog, the Financial Services Authority, show the number of complaints to firms rose from 1,476,183 in the second half of 2008 to 1,507,139 during the first six months of this year (see the Financial Fight Back guide).

Protests about general insurance (mostly about PPI) shot up from 281,275 to 334,443 over the same period. This also represents a huge 72% increase since the first half of 2006 (see the PPI reclaiming guide for free template letters).

Complaints about the way those behind on payments are treated rose by 41% to 39,181.

Earlier today, the FSA revealed it is fining mortgage lender GMAC-RFC £2.8 million and ordering it to repay over £7.7 million in compensation due to its unfair treatment of those in arrears (see the GMAC refunds MSE News story).

Not only have the number of total complaints risen, but the proportion of those upheld by firms fell from 40% to 38%.

In September, independent arbitrator, the Financial Ombudsman Service, named and shamed the worst banks, building societies and insurers for complaint rejections

In some cases, because so many gripes are dismissed initially, the Ombudsman upholds up to 99% of complaints it receives. The worst examples concern huge numbers of rejected PPI misselling claims.

How to complain

If you're unhappy with service or you've been overcharged, first complain to the relevant provider.

You can take your protest to the Ombudsman if you've had a firm rejection or if you've not had a satisfactory response within eight weeks.

See the relevant guides to get issue-specific complaints tips and free template letters (in the Bank Charges, Bank Charges Hardship, PPI Reclaiming, Credit Card Charges, Direct Debits, Setting Off, Mortgage Arrears and Endowment Misselling articles).

Further reading/Key links

Ombudsman guide: Financial Fight Back