However well run your firm and your advice process is, complaints have become a fact of life.
This is mostly due to the national media making a big deal of every injustice, perceived or real, and also to the ‘ambulance chasers’; the claims firms in whose interest it is to get as many people as possible to say they have been wrongly treated.
Neither of these parties are impartial: the papers use scandal to sell more and the claims companies get a cut of any successful claim. So what can you do to mitigate any complaint that is brought against you?
Step one – contact your personal indemnity (PI) insurer
The first thing you need to do is contact your PI insurer and notify them of the complaint. Failure to do this may make your insurance invalid – irrespective of whether you intend to claim or not.
Make sure you take guidance from your insurer and get every answer to the complainant signed off before you send it out.
One caveat to that is that you have to make sure that you still answer the client within the Financial Services Authority (FSA) guidelines; your insurance company cannot invalidate your insurance if they have not come back to you in time.
Step two – send a written acknowledgement within five days
Send a written acknowledgement to the complainant. This must be done within five days of receiving the complaint. In your reply you should let the complainant know your complaints procedure, the steps you will take to investigate and resolve an issue and the timescales under which they can expect an answer.
You should already have a written and approved complaints procedure, so you can send this to them or inform them of the steps within it in your acknowledgement letter.
Step three – examine the complaint
Now examine the complaint in detail and make sure you understand the exact terms of the complaint and all aspects about which the client is unhappy. If you do not understand something or need further clarification, make sure you get it at this stage.
Clarify whether the complainant is unhappy with the advice process and something that you or one of your staff has done, or if it is to do with the product itself.
Step four – look at your advice documentation
Pull out the factfind and all the notes and documentation from the initial advice and every interaction you have had with this client.
Examine notes from calls and include call transcripts or recordings if you have them. If it is a payment protection insurance (PPI) complaint look at your demands and needs statement.
Step five – establish what you can address
Use your notes to establish which parts of the complaint you can address and which you cannot.
If it is a product complaint bear in mind that as long as the product you sold is the most suitable one within your scope of service then any complaint should be referred to the product provider.
Step six – pick up the phone
Pick up the phone and speak to the customer to find out a bit more about their complaint or clarify any points about which you are unsure. Many complaints can be put to rest very quickly following a telephone call.
For example, if the client alleges a piece of advice has never taken place and you have a transcript or a signed account of it happening, once the client is made aware of this they will often drop a complaint, especially if it is one that has been instigated by a claims agency.
Step seven – contact the lender
Contact the lender to let them know about the complaint.
Many lenders carry out a pre-completion or security check where they will have spoken to the client to verify that they fully understand all the details of the product they are taking out and any insurance that comes with it.
Ask the lender for a copy of any recording or transcript of this call as this can help to prove that a client was aware of the facts before purchasing a product.
Step eight – consider the evidence
The lender’s transcript alone is not enough to prove that you have given best advice.
You also need to demonstrate that anything you sold complied with FSA guidelines. You should have recorded all advice given, the client’s circumstances and objectives and have a signed form of any exclusions and limitations.
Having considered the evidence you have to decide if the client has a case and there is a breach of conduct your end, or if you have proof that the case has no grounds.
Step nine – seek further help and inform your trade body
If you are unsure about anything, contact the Financial Ombudsman Service (FOS) or the FSA yourself to seek advice.
Speak to your trade body to tell them about the nature of the complaint and keep them informed throughout the process.
Also discuss it with other people in the industry – we are all facing the same issues and it is better for everyone if we all take a consistent approach.
Step nine – the final response
Your final response must be issued within eight weeks of the date of the complaint.
Before issuing your final response, send everything to your PI company: copies of all your notes, all documentation, including the complaint, and all your responses. Keep it in the loop at all times and ensure it is happy with your final response.
If the complaint can be justified and the error is your end, then you need to offer redress and maybe negotiate terms with the client.
Once terms are agreed on, you will need to ask the complainant to send in an acceptance letter saying that they accept the compensation that you have offered them and that they discharge your company of any further liability.
If you dismiss the complaint then you need to send a detailed response addressing every aspect of the complaint and saying why you refute it.
Refer them to your factfind, your demands and needs statement, and sending all copies of paperwork and transcripts that back up your position.
With your final response you must also send a copy of the FOS leaflet, telling the complainant about the steps they can take if they want to appeal your decision. Make it clear that they have six months to forward the complaint on.
Step 10 – review your procedures
While a lot of complaints may be frivolous, it is important to treat them all seriously.
Even if a complaint is not upheld, it is good practice to look in detail at the area of your business that the complaint referred to and see what you can improve – this could include your sales process, your literature, your recording and documentation, or your monitoring process.
Examining your business in the light of every complaint will to help ensure that your advice and procedures are first class and will help to protect you in the case of any future complaints.
