The Financial Conduct Authority (FCA), the Prudential Regulation Authority (PRA) and the Bank of England have finalised a revised scheme for complaints, following a consultation.
The revised scheme provides clarity around what people can expect when they complain against the regulator, with the aim of making it more transparent and user-friendly.
The regulators stressed that complaints were a valuable source of feedback that informed changes and improvements, and that they took all complaints seriously and welcomed the accountability.
The regulators confirmed that they would consider making a discretionary payment in recognition of financial loss in the instance of a clear and significant error, where the regulator was the sole or primary cause of that financial loss.
In response to feedback, the regulators removed the proposal that no compensatory payment relating to a financial loss would exceed £10,000, save in exceptional circumstances.
The regulators increased the levels of discretionary compensatory payments for non-financial loss and provided more clarity on eligibility.
The appropriateness of these levels will be reviewed every two years. The regulators said these changes balanced the statutory immunity of the regulators provided by Parliament against the need to make compensatory payments when at fault.
While the approach to compensatory payments has been made clearer, it is expected that payments made under the scheme will continue to be modest.
The Complaints Scheme is not an alternative route to consumer redress for the actions or inactions of firms.
Consumers have access to recourse through the firm, and redress may be available through the Financial Ombudsman Service or the Financial Services Compensation Scheme.
The new scheme will apply from 1 November 2023. Complaints made prior to this date will be considered under the existing scheme.
