The Complaints Commissioner has reported a 20% rise in complaints about FCA’s decisions on disputes in its annual report for the year ended in March.
Despite the increase the FCA, in its official response this week, says that the Complaints Commissioner has backed the FCA’s decisions in the vast majority of cases.
The number of complaints to the Complaints Commissioner about the FCA’s handling of disputes and grievances related to regulated firms rose from 1,212 in 2021/23 to 1,454 in 2022/23.
The Complaints Commissioner is an independent person approved by the Treasury who handles complaints about the FCA where the complainant is unhappy with the FCA’s decision.
The Complaints Commissioner received 242 more complaints in 2022/23 than 2021/21 – a rise of 20%.
Complaints to the FCA about its decisions have risen significantly in recent years from 1,081 in 2018/19 to 1,454 in 2022/23.
The Complaints Commissioner agreed with the FCA’s decision in 86% of cases reviewed, a slight fall from the 89% seen the previous year.
The FCA said it had seen a rise in more complex and group complaints.
Of the 1,285 complaints closed by the FCA in the past year 163 were reviewed by the Complaints Commissioner, with 140 upheld by the Commissioner (or Alternative Solicitor) with 23 decisions not upheld by the Commissioner.
The FCA acknowledged a rise in complaints about FCA fees, particularly from small firms, but said these were outside the scope of its complaints scheme as they involved the regulator’s legal obligation to fund itself from fees. Some complaints from small firms were about late payment charges and fees related to delays in cancelling permissions.
The FCA said in its response to the Complaints Commissioner: “We are conscious of the burden of annual fees, particularly on smaller firms and especially given the current challenging economic climate. This is why we have a robust and extensive annual consultation process on fees which runs from October to July and a consultation on periodic fees for the next financial year, from March to April.”
The FCA said that 91% of ‘local area’ or standard complaints were concluded within 10 working days in 2022/23 – an increase of 32 percentage points on the previous years.
In 2022/23 the FCA received 594 group complaints compared to 380 in 2021/22 – a 56% increase.
The scale of more complex cases is also apparent. In the past year the FCA has had to defer 988 complaints due to the potential likelihood of them being referred for regulatory action.
Figures from the Complaints Commissioner show a rise in group complaints in recent times. In the 2021/22 year, for example, there were 1,184 complaints about the FCA’s handling of the London Capital & Financial (LCF) mini-bond failure. These were eventually referred to an independent review scheme.
Year-on-year open and closed cases
|
Year
|
All complaints received
in the year
|
All complaints closed
in the year
|
|
2019/20
|
1,261
|
718
|
|
2020/21
|
1,596
|
820
|
|
2021/22
|
1,212
|
2,211*
|
|
2022/23
|
1,454
|
1,285
|
Source: FCA. *This number is high due to the investigation and closure of 1,184 complaints involving FCA supervision of London Capital & Finance plc (LCF) in this financial year, where the majority of complaints were received in 2018/19 and 2019/20 and deferred due to the Independent Review into the FCA’s regulation of London Capital & Finance plc.
In its official response to the Complaints Commissioner’s Report the FCA said: “We have continued to see a shift in the complexity and nature of the complaints referred to us, with a significant increase in the number of active group complaints which involve multiple complaints about the same issue.
“One of our key aims is to use what we learn from complaints, so that we can make improvements. We still have more to do but have made progress during the year. We are pleased that the Commissioner agreed with our decisions in the vast majority of the complaints that they concluded during the last year. However, we note the Commissioner’s themes and observations and are committed to continue making improvements to these areas.”
The average age of unresolved complaints has fallen considerably from 66 days in Q4 2021/22 to 48 days in Q4 2022/23.
