REGULATORY LANDSCAPE LEADS TO INCREASED AWARENESS OF RISK MANAGEMENT
On 29 October 2017, the Financial Conduct Authority (FCA) posted its review of its complaints data. The results were alarming to businesses such as banks, finance houses and insurance companies.
An initial view of the data shows that complaints are up by 10 percent on the previous year, amounting to a total of £4.13m and the value of redress paid to consumers in the second half of 2017 was £2.57bn, a rise of 9 percent.
These somewhat stark figures indicate that a failure to deal with complaints can have huge financial consequences. The popular narrative to those working within the industry is that it is too easy for consumers to complain. That would suggest that some are displaying an inability to adapt to the new legal and regulatory landscape.
The speed of change since 2014 has been alarming. Take, for instance, consumer credit. Prior to the introduction of the FCA and the provision of the now famous ‘sourcebook’, those working within the financial services industry, in terms of credit, were regulated by the Office of Fair Trading, which was a benign regulator that would only intervene when there were matters of considerable number or notoriety. The application for an ‘all categories’ licence could not have been easier. One merely completed a form and then sent that with a cheque. Providing it was renewed in a timely manner, no further interaction was required. The present day process, which must be followed for either a full or limited permission, is onerous if followed completely and in the true spirit of the FCA’s principles.
Jan-Mar 2019 issue
Corclaim