Caroline Wayman, the Chief Ombudsman and CEO at the Financial Ombudsman Service (FOS) has resigned, announcing on 10 March 2021 on LinkedIn that:
After 22 years at the service and nearly 7 years as chief executive and chief ombudsman I am stepping down from the role.
Her resignation comes the day after a highly critical article in the Daily Mail which pointed out:
Fraud victims and cheated consumers are waiting more than two years for justice due to an unprecedented backlog at the Financial Ombudsman Service (FOS).
Criticism of FOS for several years
In 2016 a major reorganisation at FOS aimed to shift more casework to be performed by generalist investigators rather than specialist teams.
Backlogs of cases began to build up in some areas.
A C4 Dispatches documentary in 2018 alleged that FOS staff had inadequate training and understanding of the financial products they were making decisions about.
In January 2019 Wayman was asked by the Treasury Select Committee about waiting times after a whistleblower said the time for a case to be allocated to a first-level investigator was ten times longer than before the reorganisation. And that 8,000 cases were in a queue for a second-level Ombudsman decision.
In November 2020, Wayman appeared before the Treasury Select Committee again – there is a transcript here and a subsequent exchange of letters between her and Mel Stride, the Committee Chair.
Stride said:
The impact of coronavirus appears to have had a significant impact on the effectiveness of the FOS, with over 56,000 cases open for more than six months and over 23,000 open for more than two years.
As the Committee expressed in our recent evidence session, there are concerns about the FOS’ budget. It costs the FOS on average £960 to resolve a case, against the case fee of £650, and it’s funding its expenditure through its reserves.
Backlogs have reached alarming levels
I don’t think the switch to generalist teams was a good move. Financial products tend to grow ever more complicated. Whether it is a complaint about an insurance payment not being made, a car being sold on unaffordable finance or a bank not refunding money after a customer was scammed, you want your case to be looked at by an expert team. Having seen a lot of similar cases and knowing what questions to ask the firm about is often the key to getting a fair decision.
But the increasing delays in resolving FOS cases cannot be put down to this.
As I wrote in January in Lessons from Amigo – FOS complaint handling needs to be faster there are three big problems with the current FOS complaints systems and only one of them is the level of FOS staffing and its structure. The other two are:
- Firms are not upholding complaints in line with FOS decisions: Firms should make decisions in-line with what they know FOS does – this is already part of the FCA’s rules but is too often ignored by firms. FOS cannot change this by itself, the FCA has to enforce its rules and insist that firms change their current practices. Then most complaints would never have to go to FOS, which could be kept for deciding difficult or marginal complaints
- There is a financial incentive for firms to go slow on FOS cases: This has to be removed. FOS should invoice at the start of a complaint not the end. And lenders that delay sending paperwork to FOS or delay responding to FOS investigator decisions should have to pay a fine to the customer.
The next FOS CEO needs to act fast
The latest FOS statistics, published a week ago, show dramatic increases in complaints coming though, with Wayman saying:
“Excluding PPI, new complaints are up by over 55% compared to the same period last year, with more and more people asking for our help to resolve problems with financial businesses.”
so it is becoming increasingly urgent to resolve this problem.
It has to be at the top of the list for the incoming FOS CEO once he or she is appointed.
Doc claims companies get good results?
Overdrafts – a hard debt to get out of
Five tips for spending less online
Alan Walker says
So will this have any impact on my case as I have been waiting a year for the ombudsman man to give a decision please
Sara (Debt Camel) says
No – current complaints will just continue.
Al walker says
Thank you for your feedback much appreciated al walker
Norman says
Good. I waited almost a year for my marker to get removed. All the wait was on Ombudsman side.
Mr and Mrs C says
I agree that the FOS have had alarming levels of backlogs. For some of the cases we are now 3 years down the line, our case with QQ had it been passed to a caseworker earlier could have been paid out rather than us missing out due to QQ going into administration. They should have employed more people as the work went up. So many of us have lost out due to these waiting times. We personally have lost out due on Wonga compensation and Quickquid as they were not resolved in time before they both went into adminstration. Both had been with the FOS for a year.
Sara (Debt Camel) says
Of course the real problem with lenders going bust is that there is no compensation scheme to help their victims.
When a PPI firm went under, the Finacial Services Compensation Scheme stepped in and refunded all the people due a PPI refund in full. But why did the FCA decided this should not help people complaining about mis-sold loans?
Nick Healey says
Is there no way to challenge this with the government to get equal treatment with PPI refunds? I imagine those effected by mis-sold payday loans are far more vulnerable than those mis-sold PPI
Sara (Debt Camel) says
complain to your MP?
Nick Healey says
I am going to, but he’s pretty useless so not expecting much
David Mawson says
About time. The FOS is in total dissaray.
Gord says
I think they should have hefty fines for companies that don’t comply and use delay tactics then they might act quicker also fine them more if they do not agree and are wasting fos time by sending to the ombudsman as ombudsman usually sides with adjudicator the delays are these companies wasting the fos time
Andy says
What a shame I feel she had little backing. Large financial institutions giving her the run around knowing that the FOS have very little legal clout. The only way to help the FOS do their job is to give them grater power to be able to fine these companys.
Sara (Debt Camel) says
I agree. FOS has its hand tied behind its back trying to deal with lenders who know they can get away with rejecting good complaints. The FCA needs to enforce its own rules, not rely on customers having complain to FOS.
Holly says
I feel my case may have been over looked by them as my buddy claim wasn’t upheld by an adjudicator or ombudsman
B says
I personally find that the FOS is far too accomodating to the businesses, my recent payday complaint with Satsuma is a great example of this! allowed the business nearly 2 months extention to provide my case file on 7 loans and then even when the complaint was settled in my favour, I am still waiting for the loans to be removed from my credit file 5 months later. When contacting the adjudicator to state that this still had not happened, I was told that 5 months was a ‘reasonable’ wait and that if they hadn’t been removed within the next 4 weeks to get back in touch
Dean Russell says
About time, i get the impression that Adjudicators tries to stop the case from being referred to a Ombudsman. I have not seen Channel 4 Dispatches programme, however the FOS has been criticised on both BBC Watchdog and Radio 4 Money Box. I agree that FOS workers are not fully trained in Debt Advice and that would help, i have had to many run ins with Adjudicators who do not have a clue what they are talking about and dont seem to fully understand the complaint, if you disagree with a decision of a Ombudsman there is no recourse, i believe a Ombudsman can not overrule a other Ombudsman decision. The FOS needs more teeth and clout
Dean Russell says
I have not changed my mind, although i still refer clients to them because we have no where else to go, the FOS are a waste of space.
Kyle the tent dude says
That’s the position I’m in atm. My case that I thought was with an actual ombudsman was with an investigator at the ombudsman service, it left me so confused when she said if amigo reject what she has prepositioned then it will be put back into a queue for an ombudsman to look into. This is why it’s taking so long because firms can ignore the investigators decision, therefore it takes longer to get sorted. Firms need to be penalised and fined for not dealing with cases and the FCA need to enforce this, it seems they are letting firms get away with murder. Such will probably be the case when Amigo push through this scheme. It’s disgusting that Amigo have been allowed to seem like they are calling the shots and move ahead with this whilst not upholding any complaints in the mean time, or very little. FCA are acting like they have no authority. So Amigo will probably either ignore my investigators suggestions and then it will be back to waiting another year until they move ahead with this scheme and I get sod all. Let down is an understatement.
Michael QUICK says
Strange she must of actually read my description of the useless FOS and her staff and self (I did write in last week) even a lot in the report above I mentioned and stated should resign as non effective.
when if ever they contact you seems to be Saturdays (Part Time maybe)
Kat says
Perhaps I was lucky with my 2 adjudicators. First was really nice and kept in touch. Second only responded when she had reached a decision. They seemed like experts to me the decisions were good one was what I expected and the other I saw why he had included 1 less loan in the refund.
Bob Dobellina says
Ms Wayman’s last significant act in post is to address backlogs (entirely self induced by merging the ombudsman role with the team manager role and abolishing specialisation), by making swathes of highly experienced adjudicators and ombudsmen redundant – or forced to accept a pay cut.
The new CEO will come too late to reverse this and will have even bigger problems to deal with than they realise.
It’s a pyrrhic victory to those who pointed out the obvious risks in the remodel right from the start. It will be the consumer who suffers (even more).
Bert says
This is 100% correct. I worked at the FOS for 12 years before the reorganisation and complaint levels were under control, with high customer satisfaction levels. The terribly misjudged abandonment of experts during the reorganisation changed everything. Wayman – along with her yes-men cronies – were 100% responsoble for the disaster that ensued. We all knew what would happen. Surprised she lasted this long.
Mr PDL says
What do you think about Amigos scheme offer Sara? Aren’t they saying if it doesnt go ahead they will be bankrupt and we get nothing? Surely it’s better to get something from this than nothing?
Sara (Debt Camel) says
Do you have a current loan from them?
Mr PDL says
I paid it off, but had lots of other loans at the same time and struggled to pay them all. I am apply for compensation for them too as I had too many to afford.
Sara (Debt Camel) says
OK, people with a current loan are in a VERY different position, but for you:
– Amigo are trying to make it look at though it is *this* Scheme or nothing. That isn’t right. There are other possible Schemes that would mean bondholders and shareholders take some of the pain – debt for equity swaps, rights issues – or Amigo simply having to put more into the “pot”.
£15m is just tiny for 700,000 previous customers – they are having to put aside £85m for 300,000 current customers so the previous customers are being offered a tiny amount. Th extra £20m they talk about is hiughly unlikely, it would require few present customers to complain and they are the ones who are most likely to as they will actually get a good result (as indeed they would if Amigo went bankrupt). theoffer of a small amount ofuture profits – it’s a small bit of jam in a few years time.
– also how will Amigo decide whether to uphold complaints. You had one loan, you paid it off. Will they just say it’s affordable?
Mr PDL says
Thank you as always for helping us Sara
Anonymous says
Redundancies were announced two weeks ago aiming to get rid of the most experienced staff. Whilst the backlogs grow. Very sad to see such experience being driven out, in just a cost cutting exercise.
P diddy says
Good riddance as a;ex banker am aplled by her bad work ethics…waste of time mnmoney
Deb says
I first complained to the Ombudsman in Sept 2019, 1 week later they replied and my case was assigned to an Investigator, over the course of the next few months I was asked by the Investigator for more information on my case and which I supplied.
After 13 months and hearing nothing from the Investigator for 4 months (despite my emailing for updates or a resolution) I received out of the blue an email from another Investigator that my case had been incorrectly assigned way back in Sep 2019 and as such my case was of a nature that is part of ongoing discussion with the financial institutions, discussions that pre-dated my initial complaint made in Sep 19 and which were still ongoing in Oct 20 and as such my case was still unassigned pending conclusion of the so called discussions.
It is now March 2021 and I receive another update from the Ombudsman to say that the case is still unassigned as the ‘discussions’ are still going on?
In short I am now 19 months in with my complaint and where it was first assigned, then unassigned and in the meantime the bank I am complaining about continue to hold me to the wall with excessive charges and with no end in sight to when the Ombudsman will conclude their ‘discussions with the financial instituitions.
The Financial Ombudsman is not fit for purpose.
Their ineptness actually exacerbates the problem rather than help conclude it.
Martin says
Impotent service with poor logic.
E.g.. you, the typical customer present affordability complaint and attach copies of the three credit agencies data, showing the extensive borrowing.
“Lender was fine giving you the loan, as the loan was small, and they have checked the data with credit carma”.
You cannot beat that logic.
Ross says
From my experience, this helps explain a lot. 2 complaints, for loans which were taken out at a similar time, for a similar amount. 1 of which was upheld, 1 of which was not, by 2 different adjudicators. The same issues, and information, used for both (such as bank statements etc..) so I was totally baffled as to why one was perceived different to the other. I know each case is investigated on its own merits but, both of these cases were literally mirroring each other. I wonder if this related to the ‘poorly trained’ staff being quoted? Incredibly frustrating, all the same. If this is proven, could a widescale review be ordered or is it a case of what’s done is done?
Sara (Debt Camel) says
From what you have said previously these were quite difficult cases, as your credit record wasn’t poor and your salary was good.
Dean Russell says
yep…We made three complaints to the FOS 8 years ago, all the same, two were upheld and one was not. All three we mirror images.
On another occasion the Adjudicator raised the issue of the client having a CCJ which was not relevant to the complaint in any shape or form whatsoever.
I came to the conclusion the FOS is a waste of space years ago, but still use it for clients because it is free and the clients has no other redress unless they go to court.
Vic says
Have to say it found them all but useless, siding with criminal activity and unable to see a fraud being perpetrated when there was clear evidence.
They also didn’t carry out a proper investigation against [firm] who forged my signature on documents
Experto Crede says
It’s the same pattern across all Ombudsman services. Not enough regulatory teeth in the first place. The constant reorganisation using a more generic workforce for ever increasing complex areas. Then having to bring in expert consultants to assess the same complex cases.
Computer systems that make no sense. Few powers to enforce decisions. Workforce demoralised and leave resulting in massive backlogs and delays and even more consultants brought in to try clear. Then at some point more reorganisation ( or disorganisation) and go back to specialist teams. Except now you’ve lost the in house expertise.
It’s almost as if the government’s of the day didn’t want the average man or woman in the street to exercise their rights…..
Kevin S says
I worked at the FOS for 16 years. I have a fairly good idea of what went wrong and is still wrong today. Some of the things you say are true, but there are a number of reasons. I write articles since I left and about critical thinking. Group think culture was a big part of the problem and for a place where independent thinking is vital this was the last place it was needed. Happy to provide an insight for you but as I say going to write in the context of Covid 19 groupthink, ironically the latest thing FOS blaming for its woes.
mortgagefeesjustice says
I think that there needs to be a one stop shop replacing FOS FCA and FSCS. FCA supervision and enforcement is virtually non existant. That can be seen by the number ammounts of fines. With my own battle with the FCA over Mortgage Arrears Fees being excessive lenders are making more profit per year than they would get on the very rare off-chance of a fine. The FOS may not be taking businesses side deliberately but if they do not uphold the complaint it is likely to leave their system and reduce the backlog. With our complaint with the FOS I have had to point out FCA MCOB rules as to why they should continue with investigating. All too quick to state it is out of time. There has been a recent ruling which indicated Unfair Terms UTTC can got back past 15 years. We were unware that there was even a thing of being mis-sold your mortgage. The FOS must impose time limits as a court would do for getting replies back. Many companies use delays to their advantage of having the case not upheld.
Sara (Debt Camel) says
You are referring to the Blemain judgment out this week? Yes – very interesting!
Elizabeth says
Hi Sara
Following your advice I made a affordability complaint about log book loans. I had numerous loans from them between 2007-2010. They repossessed my car when I could no longer afford the repayments.
Last February 2020 I made the complaint to Nine Regions who are liquidators for log book loans. I was told I had to take my complaint to the financial ombudsman and if their decision was in my favour they would make a settlement immediately. After waiting a year I have received a response from the financial ombudsman who agree my loans were unaffordable.
They have advised nine regions to repay me the difference from the loans I was given to the repayments I made which includes my car which I bought for £7500 in 2006. Plus 8% interest per year from my last repayment made in 2010 to when I get the settlement. Nine regions have said they are paying dividends of £1.77 in the pound. I am waiting to hear from The Financial Ombudsman the amount I will receive. Then I have to complete the claim form and send it to Nine Regions.
The Financial Ombudsman have been so supportive and helpful and have kept in touch by email.
Please can you let me know what £1.77 in the pound means ?
I’d like to thank you so much Sara for this website. I came across it when I was due a redress from Wonga. Without your advice I wouldn’t have known how to complain about my log book loans. Many thanks again.
Sara (Debt Camel) says
It is good FOS has been so helpful.
However I have bad news about the amount of money you are likely to receive. The Nine Regions ltd adminsitrators are paying out 1.77 pence in the pound. So if the total refund to you should have been say £2000 you would only receive £35.40.
K says
I currently have 3 complaints outstanding with the FOS due to the delays they are seeing. What I find most frustrating is my car finance complaint. I was most certainly provided the finance unfairly, looking at all the FOS cases against this company (a sub-prime lender) my situation of irresponsible lending is one of the worst. Yet, the firms default position is to deny a complaint and continue to receive £200 a month for the duration of the FOS procedure. The FOS should really have a facility to back date (to the initial complaint date) and impose refunds when a company acts in this way. I am now in a position where I have paid almost £6000 (the value of the vehicle, with over £1000 being since the start of the complaint) with £6500 still out standing for the next 2.5 years. Hopefully I will be ASSIGNED a first response investigator soon….
Nothingwitty says
Like many others, I submitted a complaint about a financial institution almost a year ago. I had heard nothing until last week, when they told me that as my complaint was over six months since the financial institution’s final response to my complaint, the FOS could not take it any further without the financial institution’s permission.
When I submitted my complaint to the FOS, I explained that the delay had been because of my partner’s mental health, that he had attempted suicide more than once and that I had been using all of my energy to support him and had actually become very depressed and that I simply did not have the mental strength to pursue the complaint at the time. The FOS’s response to this? They asked me to PROVE that my partner had been this ill and to prove the impact it had on me and that even if I provide evidence to show this, the financial institution had the right to say no to the complaint being re-opened (even though the financial institution know all of this as I told them about it but they still found in their own favour).
I asked the FOS what kind of ‘proof’ they require e.g. if they wanted testimonials from the police and paramedics who attended one of the suicide attempts, or doctors letter’s attesting to what I was saying.
I will probably hear back from them in about 3 months if recent response rates are anything to go by…
A plague on their ‘cosy little club’ houses.
Sara (Debt Camel) says
I would hope FOS will agree to look at this late complaint. A letter from your partner’s GP should be sufficient to explain the suicide attempt and a letter from your GP can explain the effect on you.
Sally says
The FOS is a mess. Having previously worked there, I’m not surprised by the backlog and management decisions and processes are shocking. They really need a strong leader to get them out of this tunnel, otherwise I wouldn’t like to think what the outcome would be.
Frances-Mary Pratt says
Anyone had experience of trying to get Legal Insurance Expenses reinstated via FoS? I am having a spat with FoS regarding this. The insurance company in question won’t release me from their ghastly embrace, nor apologise for how rude and discriminating (I am Autistic, and they made me cry, but didn’t apologise for this) they were to me. I am unable to take my main legal case to another law firm because of the Insurance Company. Absolute waste of time going to FoS, as the investigator took over three months to decide they complaint would not be upheld – on a basis of a ‘phone call (then wouldn’t send me the document regarding this and the fact she’d based her decision on it, despite my requesting it). She says she will refer it to an Ombudsman, but that seems unlikely, with the FoS in chaos following the departure of Caroline Wayman – and the notorious waiting times for referral. She was told to reform the FoS or else, but she didn’t and now she has left an unholy mess of a service behind her, which her unlucky successor will have to sort out. Why isn’t the Government cracking down on these ‘quack’ Ombudsman Services, or withdrawing their backing? Has anyone any ideas how to tackle my problem? If so, I would be very interested to hear them!
Sara (Debt Camel) says
If you have Rejected the adjudicator decision, it will go to an Ombudsman fir a final decision.
This “phone call” – was it between you and the insurer? If it was, you can ask the insurer to send you a recording if the call by submitting a Subject Access Request to the insurer. Their website should tell you how to make a SAR, a request for your personal data, it’s often in a section called Privacy.
If you send a SAR, tell your adjudicator in writing that you are doing this because you don’t agree with what has been said about the call and you do not want your case to be looked at by an Ombudsman before you have received the recording.
Frances-Mary says
Yes, the phone call was between me and my insurer, as they don’t have an email address. If they had, I would have put everything in writing. I have asked fos again to release the recording, but no joy so far. Not much of an incentive for a vulnerable person. I am in the process of doing a letter to the CEO of the company to complain, this will be with evidence. I can add a request for the recording to be released. I have asked him to investigate and take responsibility for the matter in my letter. I also have a clear recollection of what was said in the phone call and I have committed that to paper, which will be sent to the CEO. I will try your suggestion and see what happens – thanks for that. Please watch this space!
Frances-Mary Pratt says
I received all the documents from FoS, and in the process of going through them. I noticed several things which rang alarm bells, including the fact that the policy the company and FoS had been working to, was not the policy we had. Ours was Lloyds Bank, but they tried to say we had a Halifax Insurance Policy. I pointed this out at the time of dealing with DAS Lei, but they didn’t accept it. I shall now point this out to FoS and forward a copy of the correct policy to them. It seems rediculous that they have worked to the wrong policy. I read recently though that Halifax is used by Lloyds Bank to offer mortgages, but as far as I know, this has no bearing on the insurance policy.