Devon
Office
W Merricks
Chief Ombudsman
Financial Ombudsman Service
South Quay Plaza
183 Marsh Wall
LONDON
E14 9SR
Our Ref: CHL/MRB
10th
January 2005
Dear Mr Merricks
I refer to your letter
dated 17th December.
Some years ago FOS
stated in writing to a complainant, when declining their claim, that you
followed the legal maxim “he who asserts must prove”. Also that an IFA was innocent until proven guilty. Based on current cases, like that of Fling,
it is clear the FOS no longer follow these basic principles of common law (a
point you agreed when we talked by telephone some months ago).
Furthermore, your
usually unqualified adjudicators now decide (with the benefit of hindsight) the
risk of a product , and whether it ‘fits’ with the complainants original
attitude to risk, as stated by them now to you (as opposed to believing what
was stated by them to us on our factfind at the time of the sale).
In addition, we have
in writing from the FSA that an IFA is entitled to describe the risk of a
product, as they honestly see fit. So
how can you now legitimately disagree with how we described a product? e.g.
‘relatively low risk’ in the case of Fling.
This was our honest opinion at the time of the sale, so it is totally
unfair for you to now find against us due to this.
In the case of Grigg
you have the irrefutable evidence that the complainant lied to you at least
twice in order to claim compensation.
This is surely fraud which is a criminal act? If FOS continue to uphold the complaint, irrespective of whether
the lies would have altered your decision or not, you are condoning a criminal
act. I cannot believe this is what the
Treasury, the Public, or our Industry expect from the FOS.
The end result of
these unjust and currently unchallengeable decisions emanating from FOS is that
more and more IFAs will simply refuse to pay the compensation you set. I understand there are already numerous
cases where this is happening.
When IFAs agreed to be
bound by your decisions we naturally expected to be treated impartially,
fairly, and as per common law.
The pendulum needs to
swing back so cases are viewed by FOS using accepted legal principles e.g he
who asserts must prove.
Yours sincerely,
COLIN LANGTON
Chairman