Complaints about current accounts made to the Financial Ombudsman Service are soaring, as fraud victims increasingly turn to the service when seeking compensation.
The national arbiter of financial complaints is the last line of defence for those battling financial firms for compensation, often amounting to thousands of pounds.
The total number of complaints made to the Financial Ombudsman Service is also rising — but current accounts top the table of gripes.
The independent government-backed body received 26,039 complaints about these accounts in the 12 months to April 2023.
The biggest reason given was banks not offering adequate support to fraud victims who had money taken from a bank account.
Claims: The Financial Ombudsman Service is the last line of defence for those battling financial firms for compensation – often thousands of pounds
Hundreds of people who take their fight for fraud refunds to the ombudsman win their case, analysis by Money Mail’s sister website This is Money found last month.
It discovered the ombudsman sided with 370 consumers in battles with their High Street bank or credit card firm last year and ordered refunds. In one case against the bank Santander, this amounted to as much as £345,750.
When someone is defrauded, perhaps after their debit card has been stolen, a bank must provide a full refund. But if a customer is conned out of money, such as paying a trickster who has lied, rules are not so clear cut.
Most banks have signed up to a voluntary agreement to pay up in such circumstances, but where customers are not happy with the outcome they can go to the ombudsman.
A nother major grumble is shoddy customer service — with banks closing branches and pushing people on to automated services, making it harder for customers who prefer to deal with someone in person.
The ombudsman received a total 165,149 complaints — with 35 per cent resolved in favour of the complainant.
Credit cards were the second most complained about product — at 14,504. Problems included lending deals being pushed on to vulnerable customers with unaffordable terms.
The next most complained about financial service was motor insurance, at 11,851 complaints for the year ending April — a 27 per cent rise on the previous year. Difficulties in getting insurers to pay out for damaged vehicles was a major gripe.
There has also been an 85 per cent increase in motor hire-purchase cases over the year. It now stands at 11,446. Much of this was due to extra charges hidden in the small print of contracts, such as sales commission, fees and charges.
The ombudsman received 6,497 complaints about building insurance — with not only grumbles about the amount of money offered to settle a claim but also the length of time it took for insurers to pay up.
Fake investment opportunities set up by get-rich-quick scheme scammers was another key reason why consumers turned to the ombudsman.
If you have an issue with a financial firm that has not addressed a complaint to your satisfaction, call the Financial Ombudsman Service on 0800 023 4567.
