Report bad practice to FCA or ombudsman or Action Fraud?

onthego

An FCA registered company were contacted by the executor of an investor's will with relevant documents, the company advised the executor that they would be in touch if there were any funds, and then did not respond further so it was assumed the investor had previously withdrawn the investment.  Over two years later the company wrote to the deceased investor about transferring the account and the letter was opened by a family member.  As a result the executor then contacted the company again and after several further months of shocking communication and a complaint being raised, the money (<£5k) was eventually transferred to the beneficiary of the will.  In response to the complaint the company claimed not to have any evidence of being advised of the death originally and offered a small sum of compensation for the recent issues including poor communication and delays.  Evidence that the company had been notified and provided with the death certificate two years prior was forwarded to the company immediately, who apologised for their error in not having recorded the information provided originally and have now offered a slightly increased sum of compensation.   It is not clear how they were able to look up recent emails but not two year old emails sent to them from the same email address.

My concern is that the company may have other families in the position of not receiving funds they are due and not being aware that those funds exist.  The situation seems to reek of the company first avoiding paying out the investment, and then not wanting to admit this.  I would like to see the company audited or investigated regarding this, as in response to the complaint they have not made any mention of improving their practices other than in giving feedback on a training issue to one of their agents.  I am also not sure that the compensation offered is appropriate, having looked briefly at the financial ombudsman website.  I guess there is no structure for compensating for the outrage that they made it appear to the executor that there was no money invested when in fact there was and that this was only discovered when the company wrote to the deceased regarding their investment two years later.

Could anyone please advise if it would be appropriate to raise this with the ombudsman +/or FCA +/or Action Fraud or best just to accept the payment?  Thank you.

 

eskbanker

onthego said:

My concern is that the company may have other families in the position of not receiving funds they are due and not being aware that those funds exist.  The situation seems to reek of the company first avoiding paying out the investment, and then not wanting to admit this.  I would like to see the company audited or investigated regarding this, as in response to the complaint they have not made any mention of improving their practices other than in giving feedback on a training issue to one of their agents.  I am also not sure that the compensation offered is appropriate, having looked briefly at the financial ombudsman website.  I guess there is no structure for compensating for the outrage that they made it appear to the executor that there was no money invested when in fact there was and that this was only discovered when the company wrote to the deceased regarding their investment two years later.

Could anyone please advise if it would be appropriate to raise this with the ombudsman +/or FCA +/or Action Fraud or best just to accept the payment?

There's no compensation tariff for 'outrage' but if the company has offered a sum for distress and inconvenience then it's maybe worth sharing it on here so people can offer feedback - personally I'd expect (low) three figures rather than two or four.

If you consider the offer unacceptable then it's your prerogative to escalate to FOS, who'll review your particular case and adjudge whether they'd see the company's resolution as fair in the circumstances.

If you have reason to believe that there is a widespread or systemic issue within the company (as opposed to human admin errors), and have some sort of evidence of this, then you could relay the relevant details to the FCA, who, if they receive sufficient similar reports from others, might choose to investigate, but they wouldn't be doing so on your behalf as such.

If you have evidence of a crime being committed then Action Fraud would probably be the place to go....

onthego

Thank you very much for this.  

I think there is certainly a widespread and consistent poor communication and either fraud or completely inadequate record-keeping throughout the company. 
There is evidence that they were informed of the death, received the documents they requested, and did not release the money or even confirm that it existed. However I do not have the expertise to know if this constitutes a crime or not.  It feels like it must be at least a breach of regulations, if you give a bank your money you expect to be able to get it back.

wmb194

I understand how annoying this is but, to be frank, I wouldn't waste my energy and just move on. In my experience with this sort of thing the best you'll ever get out of it is words to the effect of, 'lessons have been learnt and processes altered' but whether they have or not you'll never know.

Malthusian

onthego said:

I think there is certainly a widespread and consistent poor communication and either fraud or completely inadequate record-keeping throughout the company. 

How many other specific instances of this occurring with this company have you come across?
If the answer is "none" this falls under Napoleon's Law: "Never ascribe to malice what can be explained by incompetence."
The company has probably made a loss by their error. If the offered compensation is not higher than the extra charges they applied for the extra two years they had the money, it should be. As others have said, if you say how much they have offered, we can give you an idea of whether it is normal and reasonable.

There is evidence that they were informed of the death, received the documents they requested, and did not release the money or even confirm that it existed. However I do not have the expertise to know if this constitutes a crime or not.

It doesn't.

dunstonh

 I would like to see the company audited or investigated regarding this, as in response to the complaint they have not made any mention of improving their practices other than in giving feedback on a training issue to one of their agents. 

Its not your business to do that and they are not required to tell you what action they take.  For all you know, they may have sacked someone or ignored it.  You don't know.

 I am also not sure that the compensation offered is appropriate, having looked briefly at the financial ombudsman website.  I guess there is no structure for compensating for the outrage that they made it appear to the executor that there was no money invested when in fact there was and that this was only discovered when the company wrote to the deceased regarding their investment two years later.

Compensation isn't about outrage.  it is about the inconvenience and covering costs.

I think there is certainly a widespread and consistent poor communication and either fraud or completely inadequate record-keeping throughout the company. 

And what evidence do you have to support that?   Your allegations are potentially libellous in themselves if you were to name the company.     How many cases have you evidenced where this has happened?

In reality, you don't have a clue whether it was a one off or a widespread problem.   Often errors stem from one minor issue that cascades.       Sometimes a staff member has a bad day and types things in wrong or doesn't put the necessary effort in.    Sometimes, a provider will have multiple offices where systems are not linked and things dont show on one system but do on another.   Sometimes, a staff member is just incompetent.   Sometimes it is someone covering the job without full training and just isn't aware of everything they should do.            

You cannot just jump to allegations of fraud because of one issue of poor service.

Could anyone please advise if it would be appropriate to raise this with the ombudsman +/or FCA +/or Action Fraud or best just to accept the payment?  Thank you.

1) there is no fraud.  So, action fraud would be inappropriate.   
2) you cannot complain to the FOS directly.  you have to complain to the firm first.  Only if you disagree with the outcome of the complaint can you then go to the FOS.    The FOS will not look at your allegations of fraud or widespread issues.  They only look at the case in hand.
3) the FCA does not take on consumer complaints would forward any complaint to the firm to deal with.

You have raised a complaint and that complaint is noted with the FCA.   When the FCA do a visit or desk based audit on complaints at that firm, they will look for trends or issues.  Both in what happened and how they were resolved.

DullGreyGuy

onthego said:

Could anyone please advise if it would be appropriate to raise this with the ombudsman +/or FCA +/or Action Fraud or best just to accept the payment?  Thank you.

You've not got any proof of fraud so clearly Action Fraud is out.

The FCA only take reports of unauthorised firms acting in a regulated activities from customers, anything else is a complaint and has to go via the Financial Ombudsman. The Ombudsman reports to the FCA and particular cases of concern, trends and patterns.

You say you've already logged a complaint and had a response from the company. That letter should have advised you what the next steps are if you are still dissatisfied with the matter which almost certainly will be to escalate your complaint to the Ombudsman 

Descrabled

You need to ask them how much the fund would have been worth on the date probate was confirmed. Compare this figure after adding simple 8% annual interest multiplied by the number of years the payment was delayed (1.25 for 1 year 3 months). This is the statutory interest that would be added by the ombudsman or a court.

Take them through all stages of their complaint system and demand as much informatjon as you need to make an informed decision as to accepting. I would keep asking for fund valuations at different dates that you think might be relevant.

Albermarle

It is not actually unheard of for financial services providers, pension providers/administrators to make mistakes; be very slow; not respond to queries; have IT issues; staff shortages etc.
Two of the largest pension providers, The Prudential and Scottish Widows not long ago admitted publicly they had let their customers down with appalling customer service, and were dishing out compensation payments like confetti. 
A typical payment seems to be about £250, although the previous poster has proposed a possible way of calculating a more specific figure.
After that I would just move on, life's too short.....

Malthusian

dunstonh said:

And what evidence do you have to support that?   Your allegations are potentially libellous in themselves if you were to name the company.  

No they aren't. Libel in the UK requires the plaintiff to show that the defendant caused "serious harm". For a corporate plaintiff, "harm to the reputation of a body that trades for profit is not serious harm unless it has caused or is likely to cause serious financial loss”. 
No "serious harm" is going to be caused to a financial provider by an obviously over-the-top rant on the Internet.

onthego

Thank you everyone for all the feedback.

I do appreciate that people make mistakes. This case was not due to one mistake by one person, at least two agents were aware two years ago that the documents had been provided, and this year there have been interactions with maybe 10 different agents and the money was still only paid out once the complaint was raised, after twice being promised by a certain date and then not received.  Every time all agents seem to have no record of previous interactions.  Even the complaints officer claimed not to be able to find the original interactions until the emails were re-forwarded.  There must be either an internal policy of not paying out until a complaint is received, or a lack of a necessary records system and process to deal with deceased accounts.   Financially it could be profitable for them to pretend that funds in deceased accounts do not exist, or to knowingly have a terrible process for paying them out, the small sum of compensation when they do slip up and accidentally let slip that the account exists or someone pursues all the way to a complaint would be outweighed by not paying out most of the funds.  Most beneficiaries affected wouldn’t know what they were missing out on, so the complaints would not necessarily be raised in sufficient numbers to alert the FCA.  This is why I think it important that this is reported to whoever polices/audits banks and their systems, for others benefit.  I am sorry if my outrage has offended anyone, I was once told “Anger exists to make things fair” and I would like to do what I can to ensure other bereaved families are and have been treated fairly.