Looking at redress

The Financial Ombudsman Service plays a major role in financial services disputes resolution but is a ‘one size fits all’ approach to redress altogether fair? John Virgo, barrister and Philip Ryley, solicitor examine the issue.

Philip Ryley is a solicitor and head of Financial Services & Markets at Michelmores Solicitors, based in London and Exeter. He may be contacted on tel: +44 (0) 1392 687671, email: phr@michelmores.com.

The underlying purpose of the Financial Services Ombudsman Scheme is to provide for the resolution of disputes “quickly and with minimum formality by an independent person.” [1] At the same time “if a complaint which has been dealt with under the scheme is determined in favour of the complainant, the determination may include… an award against the respondent of such amount as the ombudsman considers fair compensation for loss or damage.” [2] The Ombudsman’s policy in exercising this discretion to award “fair compensation” is stated as follows: “Where we have established that a firm is liable to pay redress, our overriding objective continues to be to try - as far as possible - to put the consumer back in the position they would have been in, had it not been for the firm’s actions. We aim, too, to ensure we use a consistent process across the full range of the complaints we deal with where redress is payable.” [3]