SVS Securities - shut down?

Sheris

masonic said:

Josl said:

The Financial Ombudsman Service Seems is offering mass blanket award of £250 for inconvenience regardless of circumstances. FOS is not fit for purpose.

Clearly when a large number of very similar complaints get referred to them, where the impact/frustration is going to be broadly the same for most complainants, a consistent offer is a means of treating each instance even-handedly. It wouldn't surprise me if this consistency was also intended to convey a message to ITI that they should be offering this compensation to everyone with a reasonable complaint. This is what a well managed firm would do. If will obviously cost ITI the compensation and FOS case fee for each complaint they don't settle before it gets to the FOS (I'm assuming they've long since run out of free cases).

That's not to say there haven't been edge cases where there were more severe circumstances and greater compensation awarded. The only way one of those is going to come to light is if ITI disagrees with it, or the complainant communicates it here or elsewhere. There might have been lower awards, although hopefully the £250 represents an assumed level of distress and inconvenience, and the FOS hasn't sought to minimise anyone's experience just because they didn't make a compelling enough complaint.

masonic, has yourself been involved in the center of SVS and ITI Capital ?   

masonic

Sheris said:

masonic said:

Josl said:

The Financial Ombudsman Service Seems is offering mass blanket award of £250 for inconvenience regardless of circumstances. FOS is not fit for purpose.

Clearly when a large number of very similar complaints get referred to them, where the impact/frustration is going to be broadly the same for most complainants, a consistent offer is a means of treating each instance even-handedly. It wouldn't surprise me if this consistency was also intended to convey a message to ITI that they should be offering this compensation to everyone with a reasonable complaint. This is what a well managed firm would do. If will obviously cost ITI the compensation and FOS case fee for each complaint they don't settle before it gets to the FOS (I'm assuming they've long since run out of free cases).

That's not to say there haven't been edge cases where there were more severe circumstances and greater compensation awarded. The only way one of those is going to come to light is if ITI disagrees with it, or the complainant communicates it here or elsewhere. There might have been lower awards, although hopefully the £250 represents an assumed level of distress and inconvenience, and the FOS hasn't sought to minimise anyone's experience just because they didn't make a compelling enough complaint.

masonic, has yourself been involved in the center of SVS and ITI Capital ?   

My SVS account was empty by the time they went bust, so I haven't experienced the delights of ITI. However, I had an unpleasant experience many years ago with a glacially slow transfer to Interactive Investor replete with errors, followed by persistent problems and glitches, which ended in an upheld FOS complaint, so I do have sympathy.

johnburman

The Financial Ombudsman Service Seems is offering mass blanket award of £250 for inconvenience regardless of circumstances. FOS is not fit for purpose.

I agree about the FOS, but I got £300.  All one can say is to keep on making the complaints - remember each person may make a complaint for every account that they have.  The FOS may join complaints but that is for them to determine.  

RasputinB

eskbanker said:

[ITI] didn't feature in the most recent FOS complaint volumes dataset, which has a threshold of 30, albeit those datasets only cover half-year periods:

Which is why ITI have been making cash offers tied to non-disclosure agreements?
The "SVS Client Support Group" lists some 63 problem reports which suggests that they had at least that number of members who should have lodged formal complaints to the FOS.
I'd guess that those who complained (and are complaining) directly to the FCA have been the most instrumental in persuading ITI to improve.

johnburman

As ever RasputinB you have hit the nail on the head

Those who complain to the FCA and FOS and go through the lengthy snail like FOS process get compensation. Obviously no NDA or similar. 

But who would deal with ITI directly? Do they ever settle for more money than the FOS award or do it more quickly? 

eskbanker

RasputinB said:

eskbanker said:

[ITI] didn't feature in the most recent FOS complaint volumes dataset, which has a threshold of 30, albeit those datasets only cover half-year periods:

Which is why ITI have been making cash offers tied to non-disclosure agreements?
The "SVS Client Support Group" lists some 63 problem reports which suggests that they had at least that number of members who should have lodged formal complaints to the FOS.
I'd guess that those who complained (and are complaining) directly to the FCA have been the most instrumental in persuading ITI to improve.

johnburman said:

As ever RasputinB you have hit the nail on the head

Those who complain to the FCA and FOS and go through the lengthy snail like FOS process get compensation. Obviously no NDA or similar. 

But who would deal with ITI directly? Do they ever settle for more money than the FOS award or do it more quickly? 

Just to reiterate, my comment quoted above related specifically to the number of ITI complaints that were escalated to FOS, which obviously excludes those that were resolved directly by ITI without such escalation - perhaps worth emphasising that FCA-regulated complaints processes entail unhappy customers dealing with the institution itself and only referring to FOS if they remain dissatisfied with the proposed resolution, so the number of complaints that make it to FOS should always be a subset of overall complaint volumes.

In other words, ITI should be making cash offers to resolve complaints (if compensation is the most appropriate mechanism), and the use of NDAs is irrelevant to FOS escalation, as customers should only escalate to FOS if they don't accept the proposed resolution - it's obviously customers' prerogative to do that if they're still unhappy, but the intention of the process is that this is the exception rather than the rule.

My understanding remains that complaining to the FCA might indeed contribute to them taking generic enforcement action against ITI but that the FCA won't actually intervene directly with an individual complaint between the customer and ITI, unless anyone has contrary experiences?

RasputinB

eskbanker said:
"customers should only escalate to FOS if they don't accept the proposed resolution - it's obviously customers' prerogative to do that if they're still unhappy, but the intention of the process is that this is the exception rather than the rule.."

Is it really the intention of the process that companies settle complaints with cash? Shouldn't it be at least part of the process that companies are incentivised to improve their service?

I think that firms like ITI could be persuaded to quickly put right their failings if most of its clients made strong complaints and not just once but, when there are multiple continuing failings (as have been described in this forum) about each failing.

If these are all fully run up through the complaint process then I’d expect that the costs, administrative expenses, potential FOS awards and attendant poor publicity from the published decisions, would be really effective in persuading ITI to improve its service.

johnburman

I do not think that there is anything that can be done to improve iti service to its clients. They simply do not care. And there seems nothing the FCA can or want to do to improve them. The FOS are ignored by or as close to ignoring iti as it is possible to be. 

eskbanker

RasputinB said:

eskbanker said:
"customers should only escalate to FOS if they don't accept the proposed resolution - it's obviously customers' prerogative to do that if they're still unhappy, but the intention of the process is that this is the exception rather than the rule.."

Is it really the intention of the process that companies settle complaints with cash? Shouldn't it be at least part of the process that companies are incentivised to improve their service?

I think that firms like ITI could be persuaded to quickly put right their failings if most of its clients made strong complaints and not just once but, when there are multiple continuing failings (as have been described in this forum) about each failing.

If these are all fully run up through the complaint process then I’d expect that the costs, administrative expenses, potential FOS awards and attendant poor publicity from the published decisions, would be really effective in persuading ITI to improve its service.

The first paragraph isn't really what my quoted comment was about (its point being that an institution should aim to resolve complaints itself, with FOS only acting as a secondary safety net) but I do know what you're getting at, in terms of differentiating between short-term tactical activities (such as throwing money at a customer to make an individual complaint go away) and longer term holistic or strategic focus on continuous improvement, etc.  However, my understanding remains that the FCA-mandated complaints processes are effectively only geared towards the former, although perhaps there are other parts of the FCA regime (away from the DISP part of the handbook) that expect firms to take a bigger picture stance?

In an ideal world there might be some sort of virtuous circle where complaint volumes drove improvements but I just don't see it happening in the way you anticipate, and especially don't see the poor publicity angle as being a significant factor, and all the more so for a company of the minuscule (relative) scale of ITI.  Hargreaves Lansdown, for example, attracted more than 10,000 complaints in the last year's worth of published data - how much (non-Woodford) publicity have you seen about that?

Maybe it's a wearily cynical viewpoint but I believe that financial firms (as with most other customer-facing organisations) recognise that complaints are a cost of doing business, and, while they'd all intuitively like to eliminate them, they understand that the costs of doing so will often be prohibitive - there obviously are costs incurred in complaint handling, but equally if elimination (or even significant reduction) of complaints was genuinely to be targeted, the costs of additional staff, more training, systems upgrades, etc, etc, are always going to be weighed against the benefit....

RasputinB

Hi eskbanker,

I think that what you say, especially in your last paragraph, makes perfect sense.

As you may have guessed, most of the words in my previous post came from the FOS. (See DRN2331800)

Although I don’t think much of the FOS as an organization there will be decent individuals working there who can see the rights and wrongs of the existing systems.

It is understandable that johnburman and others think that ITI don’t care. We probably all agree that a few hundred pounds to extinguish complaints is chicken feed compared to the cost of actually fixing the problems – which should now be historic anyway.

But I do think that you are underestimating the cost of reputational damage. I believe that the ITI scheme was to gain a presence as a player in the London stockbroking arena. Some 18,000 clients would enhance their status (even if revenues were low they can be bolstered from other ITI entities – see their accounts) and their marketing appears to be geared to their international presence.

To have what should be the London jewel in the crown unable to take on retail clients due to regulatory problems must have devalued the whole enterprise considerably. Not to mention the loss of face.

Even firms with great PR like Hargreaves Lansdowne will have some concern. After all it is well known that the share transfer process between UK stockbrokers is a disgrace, so much so that they, and others, have made noises about improving it.