UK Financial Ombudsman Service Publishes Feedback to Consultation on Charging Claims Management Companies and other Professional Representatives

The U.K. Financial Ombudsman Service published a feedback statement to its consultation on its proposals to charge fees to claims management companies and other professional representatives. The statement summarizes the feedback and provides a high-level summary of the FOS's response to the feedback received.

The FOS proposes to, broadly as consulted on: (i) continue with the option to implement a fee of £250 per case, reducing to £75 where the case is determined in favor of the complainant represented by the CMC; (ii) avoid vested financial interest in the outcome of any individual complaint by reducing the fee payable by the respondent firm by £175 where the complaint is not successfully upheld against them. The FOS would retain £75 in every case, regardless of outcome, as this broadly equates to the cost of setting the case up on its systems; (iii) increase the free case limit from three to ten per financial year for each CMC, so they could test cases raising new issues and learn from them; with a view to this informing their own due diligence for subsequent cases of that type which they may wish to bring; (iv) utilize fees gathered to improve its outreach and engagement; and (v) implement the arrangements as soon as possible, subject to Parliamentary and U.K. Financial Conduct Authority stages, which the FOS now accepts is likely to be early 2025. The recent General Election means that the FOS is still awaiting the necessary secondary legislation to advance proposals. Depending on the outcome of the relevant approvals required, the FOS will publish a separate policy statement in due course, upon further development of the affirmative procedure by Parliament and appropriate final consideration by the FCA. On November 19, 2024 the FOS published a letter sent to the FCA to confirm the FOS's position.

Return to main website.