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http://www.bba.org.uk/media/article/...ements-to-past-
Judicial review will decide whether FSA can apply new requirements to past sales:
A hearing to determine whether changes in complaints handling demanded by the Financial Services Authority and Financial Ombudsman Service are wrong in law begins in the High Court tomorrow. The British Bankers' Association is asking the court to determine whether the regulators can impose new requirements on firms which go beyond what was stated in the FSA's own rulebook - specifically those on handling complaints about payment protection insurance (PPI) sales.
The BBA said:
"This is an impossible situation for both banks and their customers, as there is no legal clarity about how complaints should be handled.
"Customers expect their complaints to be handled on a fair and consistent basis, and our members are committed to doing so. But our members’ actions must be assessed on the basis of a proper understanding of the relevant law and regulation. We do not believe the FSA or the FOS have properly applied the law in this area, but we have been unable to reach agreement with them on this point.
"To date, the UK banking industry has implemented every reform on PPI sales and complaint handling required by the regulators. It has now been told to implement changes which would effectively apply new standards to past sales. We feel that these go beyond the rules and regulatory requirements which were developed by the regulator over time, and we believe this to be wrong in law.
"We have been left with no option but to test the true legal position through the judicial review process, having exhausted all other avenues for discussion. No one wants to go to court but the law needs to be clear."
In the meantime BBA members continue to handle all PPI-related complaints in accordance with FSA rules. Where the assessment of the complaint would not be affected by the judicial review, these complaints will be handled in the normal way. If the complaint will be affected by the judicial review, and cannot be resolved at this point, then the bank will write to inform the customer. It remains a matter for individual BBA members to determine the details of how to handle complaints by their customers. But customers should be assured that all complaints will be reviewed - even those delayed by this judicial review process.
There is no deadline for receipt of complaints. If customers have a problem regarding PPI they should contact their bank and, if necessary, complain in the normal way.
Notes to Editors
The BBA has asked for a judicial review of the FSA policy statement on PPI complaints and guidance published by the Financial Ombudsman Service. The hearing begins tomorrow (Tuesday 25th January 2011) at the High Court in London.
The BBA has produced a factsheet explaing why it is bringing this judicial review.
Judicial review will decide whether FSA can apply new requirements to past sales:
A hearing to determine whether changes in complaints handling demanded by the Financial Services Authority and Financial Ombudsman Service are wrong in law begins in the High Court tomorrow. The British Bankers' Association is asking the court to determine whether the regulators can impose new requirements on firms which go beyond what was stated in the FSA's own rulebook - specifically those on handling complaints about payment protection insurance (PPI) sales.
The BBA said:
"This is an impossible situation for both banks and their customers, as there is no legal clarity about how complaints should be handled.
"Customers expect their complaints to be handled on a fair and consistent basis, and our members are committed to doing so. But our members’ actions must be assessed on the basis of a proper understanding of the relevant law and regulation. We do not believe the FSA or the FOS have properly applied the law in this area, but we have been unable to reach agreement with them on this point.
"To date, the UK banking industry has implemented every reform on PPI sales and complaint handling required by the regulators. It has now been told to implement changes which would effectively apply new standards to past sales. We feel that these go beyond the rules and regulatory requirements which were developed by the regulator over time, and we believe this to be wrong in law.
"We have been left with no option but to test the true legal position through the judicial review process, having exhausted all other avenues for discussion. No one wants to go to court but the law needs to be clear."
In the meantime BBA members continue to handle all PPI-related complaints in accordance with FSA rules. Where the assessment of the complaint would not be affected by the judicial review, these complaints will be handled in the normal way. If the complaint will be affected by the judicial review, and cannot be resolved at this point, then the bank will write to inform the customer. It remains a matter for individual BBA members to determine the details of how to handle complaints by their customers. But customers should be assured that all complaints will be reviewed - even those delayed by this judicial review process.
There is no deadline for receipt of complaints. If customers have a problem regarding PPI they should contact their bank and, if necessary, complain in the normal way.
Notes to Editors
The BBA has asked for a judicial review of the FSA policy statement on PPI complaints and guidance published by the Financial Ombudsman Service. The hearing begins tomorrow (Tuesday 25th January 2011) at the High Court in London.
The BBA has produced a factsheet explaing why it is bringing this judicial review.
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