What Is the Financial Ombudsman Service?
The FOS is a UK ombudsman appointed by the government yet can operate independently. They were given powers by the Financial Services and Markets Act 2000 in 2001. As with most ombudsmen, the role of this one is to help settle disputes between consumers and UK-based businesses that offer financial services.
This includes money transfer services, finance companies, financial advisers, insurance companies, building societies and banks. However, money transfer companies only entered the responsibilities of the FOS in November of 2009
The headquarters of the FOS is in London, the United Kingdom, and the Chief Ombudsman is Nausicaa Delfas. The organisation is funded via a combination of case fees and statutory levies. These are paid by financial institutions regulated by the Financial Conduct Authority.
What Is the FOS Responsible for?
This section covers the various responsibilities of the FOS. This will inform you about why the organisation exists and how money transfer customers can benefit from them. Overall, sending money to the UK is a safer practice because they help resolve disputes.
Resolve disputes: the primary role of the FOS is to settle disputes. This means they will listen to both sides of the argument before deciding. They promise a fair process that considers all case factors before deciding on the outcome.
Powers: the FOS has powers that it can use to hand out fines and take other measures when working on a case. The FOS powers are handed down from the Financial Services and Markets Act 2000, which means they act on behalf of the UK government.
Take several factors into account: the FOS has to take into account various aspects of the case, which include the relevant laws and regulations, codes of practice, and what the ombudsman deems to be good practice at the time of working on the case.
Impartiality: the FOS has to be impartial in each case they work on. This provides trust in the process and ensures that the parties on both sides of the case will accept the verdict.
Fast process time: the FOS has to work through many cases rapidly to ensure that resolutions are provided promptly. Therefore, it is responsible for accepting and dealing with complaints that do not result in backlogs.
According to the data released by the FOS, around 200 businesses are responsible for approximately 90% of the complaints. Also, about 90% of the disputes that the FOS take part in are resolved during the early informal stages. This dramatically reduces the workload on the organisation and promotes trust in the money transfer industry.
What Is the Importance of the FOS?
Now let us look at why the FOS is a critical organisation. This section offers essential factors that will improve your trust in using money transfer companies in the UK.
Improves trust: the FOS might not strengthen your trust in a specific money transfer service, but you will have more confidence in the industry as a whole. That is because you can trust the FOS to get you out of a situation where a business has broken its promise or not offered the advertised service.
Retrieve funds: the FOS could be your only solution for getting back lost funds that a money transfer company holds. For example, if a transfer was sent to the wrong recipient or funds are frozen without a reasonable explanation, you can turn to the FOS for help.
Fairness: the FOS is known for its impartial and fair approach to settling disputes. Both parties can be confident that the decision was made by objectively looking at the details. This increases the likelihood that both sides will agree with the outcome.
They offer help to everyone: the FOS does not turn away cases. On the contrary, they are there to help solve all relevant disputes so they can confidently continue interacting with the UK’s financial markets.
The FOS in action involves the sending of money to an abusive ex-partner during divorce proceedings. The complainant, Alex, was upset to discover that several weeks' worth of transactions were sent to the ex-partner's address. The FOS felt that Alex should receive 1,500 GBP compensation.
This section covers the regulations, crimes and industries relevant to the FOS. This allows you to figure out what the FOS is about at a glance and where their responsibilities end. In addition, consumers of money transfer services can benefit by learning about the type of help available to them.
Regulations: the powers that the FOS acts with were handed down as part of the Financial Services and Markets Act 2000. They received these powers in 2001, allowing them to hand out fines and make critical decisions on the outcome of a case.
The FOS is also covered by the Freedom of Information Act 2000 as of November 2011. Also, the board of the FOS is appointed by the Financial Conduct Authority. The board has the task of ensuring that the FOS remains independent and impartial in all of its cases.
Crimes: the FOS deals with all types of issues, and financial crimes might be included among the cases they receive. However, rather than dealing with serious financial crimes, those cases might be passed down to the relevant authorities instead of dealing with serious financial crimes. The FOS primarily deals with disputes and complaints.
Industries: the FOS covers complaints regarding most organisations that provide financial services. This includes money transfer services, finance companies, financial advisers, insurance companies, building societies and banks.
Accountability: as mentioned above, the FOS has its board appointed by the Financial Conduct Authority, which means that is where the accountability lies.
What Regions Does the FOS Cover?
The FOS is only responsible for disputes with financial service companies operating in the UK. However, this can include international money transfer companies like Wise, Currencies Direct, WorldRemit and Xe. The ombudsman has very little collaboration with organisations from abroad when resolving disputes.
When Might You Encounter the Financial Ombudsman Service?
The general public might encounter the FOS when they have a dispute with an organisation that offers financial services. This might be because you feel the fees with a money transfer were not represented accurately, or your money is frozen without a valid reason.
You would start interacting with the FOS by making a complaint on their official website. However, they first encourage you to seek a resolution by contacting the financial service in question.
When making a complaint, you should provide as much relevant information as possible for the FOS to work with. They will then look at the provided information and interact with the business to get their side of the story. Finally, the FOS will share their thoughts, and you can decide if you want to take things further if no resolution is given in your favour.
Can the FOS Make New Rules?
The FOS does not have the power to make new rules about how financial services companies must conduct their business. Their only responsibility is settling disputes, which can involve fines and compensation payout to the party making the dispute.
How to Contact the FOS?
This section provides details to contact the FOS to make a complaint or find out more about their services. This allows money transfer customers to figure out what they need to do before filing a complaint.
Complaint form: visit the official Financial Ombudsman Services website and complete the complaint form to start the process of getting a resolution to your dispute.
Phone: 0800 023 4567
To summarise, the FOS is a consumer-friendly organisation that promotes trust and helps overcome problems dealing with money transfer companies and banks. You can turn to the FOS for help when feeling mistreated by one of the financial services in the industry. This allows you to send money to the UK with peace of mind.
Read our other guides to continue learning more about the process of money transfer to and from the UK. For example, you can start with Send Money To the UK and Send Money to the USA from the United Kingdom. The knowledge gained from those guides will help you get better FX rates and find companies that offer the lowest fees.