Financial Ombudsman Unbiased? I think not!

Angry_Cat

magpiecottage wrote: »

29 April 1988

Ignoring that only Parliament can create (make) laws through acts of leglsation and that the FSA is really just a limited company with statutory powers and not even a government department, wasn't the FSA created in October 1997 ?

If we want to discuss facts

The Chancellor of the Exchequer announced the reform of financial services regulation in the UK and the creation of a new regulator on 20 May 1997.


The Chancellor announced his decision to merge banking supervision and investment services regulation into the Securities and Investments Board (SIB). The SIB formally changed its name to the Financial Services Authority in October 1997.


The first stage of the reform of financial services regulation was completed in June 1998, when responsibility for banking supervision was transferred to the FSA from the Bank of England. In May 2000 the FSA took over the role of UK Listing Authority from the London Stock Exchange. The Financial Services and Markets Act, which received Royal Assent in June 2000 and was implemented on 1 December 2001, transferred to the FSA the responsibilities of several other organisations:

magpiecottage

Angry_Cat wrote: »

Ignoring that only Parliament can create (make) laws through acts of leglsation and that the FSA is really just a limited company with statutory powers and not even a government department, wasn't the FSA created in October 1997 ?

Actually, it changed it name from the Securities and Investments Board to the Financial Services Authority at that time - but it already existed and had first been given the power to make rules which had the force of Law under the Financial Services Act 1986 - which came into force on 29 April 1988.

The Chancellor of the Exchequer announced the reform of financial services regulation in the UK and the creation of a new regulator on 20 May 1997.

But in reality only changed the name of the existing SIB and gave it new powers.

The Chancellor announced his decision to merge banking supervision and investment services regulation into the Securities and Investments Board (SIB). The SIB formally changed its name to the Financial Services Authority in October 1997.

See.

Angry_Cat

Without wishing to enter into a pointless peeing contest

The SIB was the former regulator of the UK investment market (in accordance with the Financial Services Act 1986).

It was not the regulator of the banking industry. The SIB only regulated certain products such as endowment policies. Therefore, it had no statutory powers in regard to personal banking services or any other non related investment productssuch as PPI, Credit Cards, Mortgages etc...

The Bank of England (BOE) actually had a supervisory role, which was further expanded following the 1987 act. However, it was the Bank of England Act 1998 that resulted in the superisory role of the Bank of England being transferred to the then newly created FSA.

Returning to the Securities and Investments Board Ltd, the Chancellor of the Exchequer delegated certain statutory regulatory powers to it under the Financial Services Act 1986, via subsequent delegation orders.

Whereas, the FSA derives it's statutory powers from the FSMA 2000. Whilst the FSA has legal powers of enforcement (including private prosecusion) of authorised persons and authorised compnies when they provide authorised activities.

Angry_Cat

magpiecottage wrote: »

That is incorrect because FSA rule DISP 3.6.4R says

"In considering what is fair and reasonable in all the circumstances of the case, the Ombudsman will take into account:

(1) relevant:
(a) law and regulations;
(b) regulators' rules, guidance and standards;
(c) (c) codes of practice; and
(2) (where appropriate) what he considers to have been good industry practice at the relevant time."

For the avoidance of any doubt the above FSA rule, is not in any shape of form, law created by the FSA. That would be nonsense.

This rule is from the law created by the government via legislation, more specifically s.228 of the FSMA 2000 which states:

228 Determination under the compulsory jurisdiction.

(2)A complaint is to be determined by reference to what is, in the opinion of the ombudsman, fair and reasonable in all the circumstances of the case.

The aforementioned rule does not create law, it only provides further clarity of the law.

Alpine_Star

magpiecottage wrote: »

29 April 1988

PMSL.

You're confusing the statutory powers of the regulator with the law making powers of Parliament.

Alpine_Star

magpiecottage wrote: »

In that case, Lord Hoffman specifically said that it was not fair or reasonable to hold somebody responsible for something that was not a reasonable foreseeable consequence of any failure.

As far as the FOS is concerned it doesn't matter what Lord Hoffman thinks is fair & reasonable. It's the opinion of the Obudsman that counts.

The FOS is not confined to determining complaints soley by reference to the law or case law.

''The FOS has a very broad statutory basis in s228 of the Act for reaching its decisions: what is in the opinion of the Ombudsman, fair and reasonable in all the circumstances of the case. The case begins with a complaint, and that is broadly defined in the Handbook Glossary. It can cover financial loss, and material distress and inconvenience. The Ombudsman's procedures are not limited to those of a court, nor is the evidence which he can admit. This is not surprising since the statutory purpose of the scheme is to provide a quick, informal, non-legalistic method of dealing with complaints. The remedies include compensation but it is not limited to those heads of loss to which a court would be confined, and he can give directions which a court could not.''

http://www.bailii.org/ew/cases/EWHC/Admin/2011/999.html

roonaldo

Parliament passes laws.
Wikipedia says FSA formed in 2001. but any to55er could have changed that!

magpiecottage

Alpine_Star wrote: »

As far as the FOS is concerned it doesn't matter what Lord Hoffman thinks is fair & reasonable. It's the opinion of the Obudsman that counts.

But I would venture that Lord Hoffman's opinion about what is fair and reasonable ought to carry more weight than yours (or mine) and therefore should be considered by the Ombudsman.

If the Ombudsman chooses to ignore it then they should give reasons for doing so.

However, I believe you were in sympathy with the assertion that FOS is biased in favour of the banks. My post was evidence to the contrary so it would seem to undermine that assertion.

magpiecottage

roonaldo wrote: »

Parliament passes laws.

Am I not correct in thinking your former boss, Walter Merricks, once boasted "We unashamedly make new law"?

Alpine_Star

magpiecottage wrote: »

But I would venture that Lord Hoffman's opinion about what is fair and reasonable ought to carry more weight than yours (or mine) and therefore should be considered by the Ombudsman.

If the Ombudsman chooses to ignore it then they should give reasons for doing so.

However, I believe you were in sympathy with the assertion that FOS is biased in favour of the banks. My post was evidence to the contrary so it would seem to undermine that assertion.

You can venture all you like but FSMA gives the FOS absolute discretion as to how they determine what is fair & reasonable.

And your belief that I think ''that FOS is biased in favour of the banks'' is as mis-placed as your understanding of law.