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'A very unusual case': Ombudsman appears before royal commission

The Age  |  27 May 2018  |  BankingRC

Systemic problems with the approach taken by the Financial Ombudsman Service (FOS) when dealing with disputes were revealed before the royal commission on Monday.

Philip Field, lead ombudsman for banking and finance at the FOS told the commission the body has made mistakes.

The commission heard of a system which appears to prioritise banks over applicants.

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The FOS is funded by the banks and while banks are very familiar with the FOS' processes, most applicants are not.

Mr Field told the commission the majority of applicants don't have a lawyer and have very limited resources.

Compensation awarded by the FOS is capped at $323,500 and once the FOS has made its determination there is no further appeal or review challenge within the FOS.

The only appeal channel for applicants to the FOS is through the courts but Mr Field said this happened "very rarely".

The commission considered the FOS's actions in finding maladministration in a $240,000 loan made by Suncorp to widow Jennifer Low after the death of her husband, Peter.

On Friday, the banking royal commission heard how Suncorp aggressively pursued Jennifer and son Rien Low over Peter's five outstanding business loans.

Mrs Low found she was $2800 short each month of the loan repayments so she sought hardship assistance from Suncorp, asking for 12 months to figure out how to pay the loans back.

Read More: https://www.theage.com.au/business/small-business/a-very-unusual-case-financial-ombudsman-service-s-failings-laid-bare-before-royal-commission-20180528-p4zhwo.html

 

 


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