Finance watchdog publishes its accounts

Monday 25 July 2016

A new watchdog set up to resolve complaints about CI financial services companies has received 340 complaints since it launched in November 2015, with the biggest compensation payout being £67,235.

So far this year, 129 complaints have been rejected by the Channel Islands' Financial Ombudsman, usually because they related to a case which was before the organisation's remit began. But of the rest, 33 were resolved by mediation between the company and the person complaining, with the Ombudsman having to enforce a ruling in just seven cases - six of those actually fell in favour of the business.

In the one case where the Ombudsman's decision was in favour of the person complaining, they received the same level of compensation as was being offered by the company involved. 

The Channel Islands' Financial Ombudsman is funded by the industry itself, and has the power to look at complaints in cases worth less than £150,000 - it's a free service for the consumer, and is intended to be a cheaper, and easier, way of resolving problems, rather than going to court. The Ombudsman's decisions have to be accepted by the company concerned.

In 2016, the vast majority of complaints have been about banks, usually about current accounts. Banks pay the largest fees to the Ombudsman, with each one in Jersey contributing £4,726 in 2016. Companies in other sectors (or banks providing services in other sectors) were asked to pay £701 each this year. Funding also comes from case fees.

Originally the Ombudsman was funded by a £200,000 loan from the States of Jersey, and one from the States of Guernsey (£225,000), which have now been repaid. The watchdog's balance sheet for Jersey only, shows that in 2015 it collected a little over £600,000 in 'revenue', finishing the year with an 'accumulated surplus' of £340,569.

The figures were published at a public meeting to present the Ombudsman's accounts for 2015.

Principal Ombudsman Douglas Melville commented: "We've generated tremendous value for all stakeholder groups. For consumers its a free opportunity to bring a complaint to us which they can't resolve with the financial service provider, for industry in situations where they've done right by their customer, we'll validate that...for politicians it's a place for them to refer their constituents to see them properly handled, and for the society as a whole here in Jersey it's an opportunity to enhance the reputation and integrity of the industry, which is good for everyone given the important of financial services to the local economy."