Complaints to the Ombudsman increased in first 6 months of 2011

Data just released by the Financial Ombudsman service (FOS) showed that complaints rose by 54% during the first half of 2011 to almost 150,000 when compared to the previous 6 months. The mis–selling of payment protection insurance by the large banking groups was responsible for the huge increase, accounting for around 72,000 of total complaints.

Lloyds Banking Group topped the table with over 32,000 complaints and was joined by Barclays, RBS and HSBC who all saw an increase in their overall number of complaints.

Of the big five banks only Santander saw a decrease in complaints, albeit it a small one, from 6,759 at the end of December to 6,434 at the end of June.

In comparison, complaints about mortgages were relatively low overall, although several of the big banks again appeared at the top of the table. The highest level was for the Bank of Scotland, part of the Lloyds Banking Group, who received 590 complaints relating to mortgages and home finance. Santander UK received the second highest with 460 followed by Barclays Bank which received 362.

Other significant lenders included Northern Rock Asset Management, which received 212 complaints, Clydesdale Bank and Cheltenham & Gloucester who both received 201 complaints.

On average, 38 per cent of all mortgage complaints were upheld in favour of the consumer.

Following the banking crisis it is no wonder consumers have concerns around the actions of banks. The Financial Ombudsman Scheme is a valuable service enabling individuals to register complaints and have them impartially assessed when they are unhappy with the outcome of a complaint investigation by their financial institution. Publishing complaints information on a regular basis is good as it alerts customers to the service being provided by individual banks, making them more accountable for their actions. Ultimately it may also impact the amount of business they do.

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