SVS Securities - shut down?

eskbanker

RasputinB said:

eskbanker said:

RasputinB said:
I think I'll need to think on this as I have difficulty understanding how the FOS could assert that they don't need to consider complaints relating to complaint handling when the considerable delays in handling complaints have aggravated the Distress & Inconvenience caused by the delays in returning assets etc.

If you're seeking to treat complaint handling as an incremental head of damages in that way, are you referring to a scenario where assets were returned (after a delay) and then subsequently a complaint took ages to address, or are these timescales concurrent?

Very likely that a complaint was raised at the time of delay of return of assets and is ongoing until all assets are returned. In my case ITI have still not provided me with confirmation that they have returned all assets. (Assets include the fruits of assets i.e. dividends, right issues etc. Scenarios could include further complaints relating to those.) 
If I've missed the point that you are making please feel free to elaborate.

I'm just trying to understand the extent to which delays in complaint handling can legitimately be decoupled from delays in processing instructions - if it's all concurrent in this example and the complaint is seen as ongoing until all assets are returned then to me there's an argument that any compensation award would relate to the distress and inconvenience of the whole situation?  I imagine you'd disagree with that though!

RasputinB said:

I have looked at the list of regulated activities and can't see that the transfer of securities to another broker is included. If that isn't a regulated activity would it mean that the FOS don't need to consider complaints relating to transfers of securities to another broker?

Likewise, I can't see anything obvious, but https://www.legislation.gov.uk/uksi/2001/544/made is the full version of the associated legislation and it may be in there somewhere (article 40, administering investments, perhaps?)!  I imagine you'll have found FOS decisions relating to such transfers though?

RasputinB

eskbanker said:

RasputinB said:

eskbanker said:

RasputinB said:
I think I'll need to think on this as I have difficulty understanding how the FOS could assert that they don't need to consider complaints relating to complaint handling when the considerable delays in handling complaints have aggravated the Distress & Inconvenience caused by the delays in returning assets etc.

If you're seeking to treat complaint handling as an incremental head of damages in that way, are you referring to a scenario where assets were returned (after a delay) and then subsequently a complaint took ages to address, or are these timescales concurrent?

Very likely that a complaint was raised at the time of delay of return of assets and is ongoing until all assets are returned. In my case ITI have still not provided me with confirmation that they have returned all assets. (Assets include the fruits of assets i.e. dividends, right issues etc. Scenarios could include further complaints relating to those.) 
If I've missed the point that you are making please feel free to elaborate.

I'm just trying to understand the extent to which delays in complaint handling can legitimately be decoupled from delays in processing instructions - if it's all concurrent in this example and the complaint is seen as ongoing until all assets are returned then to me there's an argument that any compensation award would relate to the distress and inconvenience of the whole situation?  I imagine you'd disagree with that though!

RasputinB said:

I have looked at the list of regulated activities and can't see that the transfer of securities to another broker is included. If that isn't a regulated activity would it mean that the FOS don't need to consider complaints relating to transfers of securities to another broker?

Likewise, I can't see anything obvious, but https://www.legislation.gov.uk/uksi/2001/544/made is the full version of the associated legislation and it may be in there somewhere (article 40, administering investments, perhaps?)!  I imagine you'll have found FOS decisions relating to such transfers though?

My core argument has been that we should expect compensation for delays in complaint handling. If any award would relate to the whole situation and you are wondering whether or not the the complaint handling part can be decoupled then it looks like you agree that there could be an element of compensation for delays in complaint handling?
Some ombudsman decisions suggest that complaint handling is an area that is not regulated and therefore they shouldn't consider it. I'm sure that I have found instances of FOS awards for failures relating to activities which aren't listed as regulated activities. This may include transfer of stockholdings and I have read that sometime this year the FCA intend carrying out a review of the progress that the industry has made towards making the switching process more efficient.
Maybe that will give some clarity.
Moving on a bit, I have noticed that the ombudsman decisions appear to be very clear that hypothetical losses should not be considered. There wasn't much interest in my post where the SFA had awarded for hypothetical loss. That award was made about two decades ago; but some years after the Watts v Morrow court case that appears to still be a legal precedent. I didn't have a trading loss, theoretical or otherwise, that was due to the delay in transfer of my main assets but I have read that others think they had. I've flagged this up again as I think it worth wondering why the FOS can now exclude compensation for hypothetical loss when it wasn't excluded in the earlier arbitration scheme.

johnburman

My core argument has been that we should expect compensation for delays in complaint handling. 

This must be right, as it is a failure of ITI and a failure to "treat clients fairly". The problem is what is the quantum?  It is non-pecuniary; it causes stress and inconvenience (which can be claimed), but only a modest sum will be awarded.

So it is worth claiming ...but not worthing going to the 'small claims court' for!

eskbanker

RasputinB said:
My core argument has been that we should expect compensation for delays in complaint handling. If any award would relate to the whole situation and you are wondering whether or not the the complaint handling part can be decoupled then it looks like you agree that there could be an element of compensation for delays in complaint handling?

Not really, in the context of the scenario you described - if, for the sake of argument, there was a two year delay in completing all your transfer activities, then my understanding is that FOS will consider the associated distress and inconvenience holistically, rather than trying to split it up into a chunk of time relating specifically to complaint handling and the rest not, with separate compensation figures for each.  In other words, I'd expect them to consider two years' worth of distress and inconvenience regardless of its composition, although I don't know whether or not they'd differentiate between, say, one year and two years in total when evaluating compensation.

RasputinB said:

Moving on a bit, I have noticed that the ombudsman decisions appear to be very clear that hypothetical losses should not be considered. There wasn't much interest in my post where the SFA had awarded for hypothetical loss. That award was made about two decades ago; but some years after the Watts v Morrow court case that appears to still be a legal precedent. I didn't have a trading loss, theoretical or otherwise, that was due to the delay in transfer of my main assets but I have read that others think they had. I've flagged this up again as I think it worth wondering why the FOS can now exclude compensation for hypothetical loss when it wasn't excluded in the earlier arbitration scheme.

The basics of contract law haven't changed since well before Watts v Morrow, but the legislation governing the creation of FOS, i.e. the Financial Services and Markets Act 2000, was after that, so my understanding is that FOS isn't bound by the regulations associated with its precursor and decisions made by the SFA wouldn't be seen as forming precedents today.

eskbanker

johnburman said:

My core argument has been that we should expect compensation for delays in complaint handling. 

This must be right, as it is a failure of ITI and a failure to "treat clients fairly". The problem is what is the quantum?  It is non-pecuniary; it causes stress and inconvenience (which can be claimed), but only a modest sum will be awarded.

So it is worth claiming ...but not worthing going to the 'small claims court' for!

In the @RasputinB scenario, it doesn't seem to me that delays in complaint handling are likely to be regarded as a valid separate head of damages and instead seems that FOS would simply lump everything together into one figure for distress and inconvenience, but I remain happy to be corrected if anyone can point to a meaningful precedent that contradicts this, whether in the courts or FOS decisions.

Likewise, the high level principle of 'treat clients fairly' seems way too abstract and woolly to form the basis of legal action, but again happy to be corrected if anyone has verifiably made that stick in any meaningful way!

masonic

johnburman said:

My core argument has been that we should expect compensation for delays in complaint handling. 

This must be right, as it is a failure of ITI and a failure to "treat clients fairly". The problem is what is the quantum?  It is non-pecuniary; it causes stress and inconvenience (which can be claimed), but only a modest sum will be awarded.

So it is worth claiming ...but not worthing going to the 'small claims court' for!

TCF is a regulatory obligation, so it is relevant in complaints pursued through regulatory channels. It is therefore for the regulatory bodies to define how these rights should be interpreted, and when they should come into play. The equivalent situation in a legal claim, for example using the small claims track, is breach of contract or relevant legislation governing consumer contracts (e.g. Consumer Rights Act). In the absence of any equivalent claim being made in court, it's impossible to say whether it would be worth it. A third option would be to draft and file a particulars of claim with ITI and see how they respond, but neither should be done if wishing to fall back on the tried and tested FOS claim route, as such a complaint is likely to be closed upon initiation of legal proceedings.

eskbanker

As Boris Johnson now knows, three-word phrases make for catchy soundbites, but rarely help in clarifying subjects that involve nuance and interpretation!

To me, the word 'fairly' has connotations of even-handedness (so active discrimination against some customers can be unfair) and honesty (so deliberately misleading wording would generally be seen as unfair), but wouldn't typically apply to (in)competence, i.e. treating customers badly isn't necessarily treating them unfairly.

However, that's not to say that a case can't be constructed that builds a bridge from poor ITI service right up to a demonstrable and actionable breach of a regulatory obligation, but it would be illuminating to see evidence of any relevant precedent....

johnburman

Masonic is right...claims for poor complaint handling and failure of TCF should be brought to the FOS not the court

Still, if an FS company is bound to do something by Regulation and does not do it, it should be easy to plead breach of contract and negligence, should it not?

eskbanker

johnburman said:

Masonic is right...claims for poor complaint handling and failure of TCF should be brought to the FOS not the court

But, as covered in previous posts, FOS won't entertain (most) complaints about complaints, on the basis of this not being a regulated activity.

johnburman said:

Still, if an FS company is bound to do something by Regulation and does not do it, it should be easy to plead breach of contract and negligence, should it not?

That's obviously your view - mine remains that it's a gross oversimplification, but it seems to me that the only ways to resolve those conflicting opinions would be for someone to try it and/or to locate a meaningful and relevant precedent....

johnburman

Agree. But it's not worth the time and effort and cost 

Simply include it in your FOS complaint