FCA Supervision - Thematic Reviews

Author:Mr Harvey Knight, Kirsten Lapham and Colin Smith
Profession:Withers LLP

Complaint handling

The FCA has published the findings of its thematic review concerning complaint handling which identified four main barriers within firms that in the FCA's view, prevents effective complaints handling under DISP:

application of FCA dispute resolution rules (DISP) culture operational models  the ability to conduct root cause analysis The results of the thematic review provide firms with the following action points to consider, including:

whether your complaints-handling policies and processes have the interests of consumers at its heart and to avoid a tick-box approach to compliance with the FCA's dispute resolution rules review your definition of 'complaint' and ensure that staff are properly trained to understand its meaning and the meaning of related words, such as 'material distress' or 'material inconvenience' check whether your systems and processes could inhibit accurate recordings of complaints and consider how this affects the ability to conduct root cause analysis. Examples of measures being introduced at some firms include significant training programmes, introducing best practice guidance and enhancing systems to make it easier for staff to categorise a complaint review your firm's approach to root cause analysis by having greater consideration of tactical and strategic root causes for customer complaints and using a wider source of relevant data focus on consistency of redress and distress and inconvenience payments. Measures introduced by firms include: reviewing the quality assurance frameworks in place and ensuring that they are aligned across all business areas and annually testing and reviewing the use, purpose and suitability of any 'calculators' available to staff identifying areas where improvement can be made as regards management information. For example, messaging, interpretation, quality metrics and use of targets. We can expect to see further changes with respect to complaints handling. The FCA is currently considering proposed changes to its dispute resolution rules and it conducting further research in light of the...

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