6th February 2012

IFA letter of the week: FOS procedures

Dear Ms Ceeney

Further my email to you on the 5^th December 2011, nearly 2 months ago, I am still waiting for a reply. The contents of what I sent should have been a concern to you.  I have been in close contact with my MP Paul Burstow, minister of State for Care services who will be writing to you very soon with some serious questions.

In addition to the recorded contents of my conversation with one of your adjudicators in 2008, I can now also confirm a second and further conversation with another separate adjudicator who has also emailed me with similar concerns. The contact I had with this new adjudicator is as recent as December 2011. This adjudicator has more or less confirmed some of the questionable staff procedures, which are also in my original transcripts and audio recordings. It does appear that little has progressed with the fairness of the Ombudsman procedures when dealing with small IFA firms. In fact there seems a procedural system in place, which is more like a conveyor belt processing plant with sales targets to be met by the staff to achieve bonuses. This is in total conflict with the spirit of an Independent Alternative Dispute Resolution Body and totally alien to dealing with such cases as a final salary pension transfer, which requires more than a ‘tick box’ approach. How is it that the FSA requires advisers to hold the specific G60/AF3 qualification and experience in the field and yet the Ombudsman’s staff can sit and judge on such cases with no such requirements?

I have particular concerns with the Ombudsman’s dealings of fairness with my firm MLP Ltd. In the 2008 recordings, your then FOS adjudicator made it very clear that my firm had been labelled. The case was eventually overturned and the re-appointed adjudicator said that the original adjudicator was way out of his depth and didn’t understand how there could be ‘no loss’ on an endowment case even if it was upheld in the clients favour. He also refused to answer specific questions which I had put to him. Something I was subsequently told was perfectly valid and reasonable.

Now I find myself in a situation whereby on another case the adjudicator in question had pre-judged the case before I even had made a submission on behalf of my firm telling me over the telephone that I should never have assisted to transfer a case from a final salary scheme. I then wrote to you personally with my comprehensive submission asking you to appoint another adjudicator as I had little confidence in this one as he had already made his mind up. You subsequently passed this submission straight back to him for his view. He unsurprisingly upheld the case against my firm. This also begs the question to the FOS, when is a transfer case from a final salary scheme acceptable? There are thousands transferring away from schemes every year for a number of reasons. Have all these transfers also been mis-sold? In our case the adjudicator ignored the reasons the client transferred and her requirements at the time. Instead has used his own opinion of what was most important for the client. This completely ignores the client’s priorities and assessment of her.

I have since asked for an oral representation, as I am aware the client has been economical with the truth, inconsistent in her statements whilst providing no evidence to support her case. The idea of an oral representation would be give the client and us an opportunity to be very clear about what was actually said at the meetings and any inconsistencies to be brought to light. I now find myself being refused an oral meeting and as an alternative being offered to contact the very same adjudicator to record any additional points over the telephone that I may wish to make but without the opportunity of a face-to-face meeting. In addition, now the very same Ombudsman, who upheld the only one other case against my firm last year, has been appointed as the Ombudsman on this case! With the evidence of the 2008 recordings it appears that the FOS had labelled my firm once again and probably at a potentially ‘substantial’ cost to my firm, as quoted in your adjudicators’ report to me.

I have asked the FOS under the Freedom of Information Act for a recording of my conversation with this specific adjudicator. This has been refused on the grounds of containing personal information. What could preclude the release of this information in the normal course of the FOS’s duties and in normal working hours? Surely it is not for the FOS to cover up any of his personal matters whilst carrying out his duties. I have also been waiting for another Freedom of Information request dated as far back as 9^thNovember 2011 asking for various details of your procedures. I have only just received today the answer to valid and pertinent question regarding qualifications of your staff member and once again I have been refused this important information.

I have asked you kindly to deal with my cases in a fair fashion, but you have refused any of my reasonable requests whilst also ignoring my last email. I have asked your organisation for various relevant details under the Freedom of information Act and these have been denied and ignored. If the case is finally upheld against my firm, the only option to challenge this is via a judicial review, which does not offer a level playing field. There should be an independent and impartial appeal system in place, which would be fairer to all concerned. This would also rule out some unjustifiable enrichments for clients who have produced no evidence and perhaps who have been less than truthful. I expect a fair hearing with the client present. Otherwise the FOS will not be seen as transparent and there appears to be no democratic and fair process in your systems. I have brought all this information to you personally under your watch.  If I don’t receive any form of response by soon, I have no option but to release the CD recordings and other details I have on record.

P S I have copied in my MP Paul Burstow

Paolo L Standerwick (G60 Qualified)
MLP Ltd

RDR, Adviser Letter of the Week