On Monday the British Financial Services Authority (FSA) fined Royal Bank of Scotland (RBS) and National Westminster Bank (NatWest) 2.8 million Pounds for multiple failings in the way they handled consumer complaints. The FSA highlighted that both banks responded inadequately to more than half of the complaints reviewed by the FSA.
A FSA investigation found that consumers were facing an unacceptably high risk that their complaint might not have been treated fairly. The FSA criticizes the following insufficiencies:
- Delays in responding to customers;
- Poor quality investigation into complaints, with complaint handlers failing to obtain and consider all the appropriate information when making their decision;
- Issuing correspondence that failed to fully address all of the concerns raised by customers and failed to explain why complaints had been upheld or rejected; and
- Customers not receiving their Financial Ombudsman Service referral rights within the appropriate time period.
The review showed deficient complaint handling in 53 percent; failure to comply with FSA requirements on timeliness and disclosure of Ombudsman referral rights in 62 percent and failure to demonstrate fair outcomes for consumers in 31 percent of the reviewed files.
Oliver Morgans, financial services expert at Consumer Focus criticises: “Banks have been getting away with poor customer service for too long and we are calling for them to raise their game.” And he encourages consumers to switch their bank if they are unhappy.
Further information: www.fsa.gov.uk/pages/Library/Communication/PR/2011/003.shtml and www.consumerfocus.org.uk/news/consumer-focus-response-to-the-financial-service-authority-fsa-fining-royal-bank-of-scotland-rbs-over-its-complaints-handling
Sources: FSA and Consumer Focus