Chapter 9: Complaints and Redress Flashcards
If a firm receives a complaint with respect to MiFID business and deals with it within two weeks, how long is it necessary to keep the record of the complaint and its resolution?
A. Five years from the date of the resolution of the complaint
B. Three years from the date of the complaint
C. Five years from the receipt of the complaint
D. Three years from the date of the resolution of the complaint
C. With MiFID business, the records must be kept for at least five years.
The FCA requires that firms maintain records of complaints for a period of three years from the date of the receipt of the complaint for non-MIFID business. These records need not include details of:
A. Any correspondence between the firm and the complainant, including details of any redress offered by the firm
B. The number of phone calls taken place in an attempt to resolve the complaint
C. The substance of the complaint
D. The name of the complainant
B. These records are required for the purposes of monitoring by the FCA.
To whom is the Financial Service Compensation Scheme (FSCS) PRIMARILY accountable?
A. The Treasury
B. FCA and PRA
C. Lord Chancellor
D. The First Lord of the Treasury
B. The FSCS is accountable to the FCA and PRA primarily and to The Treasury indirectly through the regulators.
Which of the following is TRUE in relation to the FCA’s power to seek redress for consumers?
A. Does not apply to breaches by market counterparties
B. Does not apply to transactions below £5,000
C. Is subject to a 28 day limit to the FCA to assess a claim
D. Includes breaches by unauthorised persons
D. In areas such as market abuse and money laundering the FCA have the power to seek redress from both authorised and unauthorised persons if their behaviour has an impact on consumers.
Which of the following does not have any rights under the Financial Services Compensation Scheme?
A. A retail client with an ISA
B. Trustee of a scheme with assets of less than £1 million
C. A small business with regard to a general insurance contract
D. An authorised firm with respect to general insurance
D. Authorised companies are not able to claim for general insurance contracts under FSCS.
When must a firm normally send a final response to a complainant?
A. Four weeks
B. Five weeks
C. Six weeks
D. Eight weeks
D. An acknowledgement letter must be sent promptly, and a final letter within eight weeks.
A client has lost £95,000 due to the negligence of the authorised person. The Financial Ombudsman Service (FOS) has awarded the client £100,000. Why might this be?
I. The threshold of the award is £100,000
II. The client had legitimate legal cost in taking the action against the firm
III. The FOS believes that the firm made it unnecessarily difficult for the client to make a complaint
IV. The FOS believes the award should be substantially higher but can only recommend a maximum of £100,000
A. I only
B. II only
C. II and III only
D. II and IV
C. II and III only.
The FOS a can consider reasonable costs and also the stress and inconvenience caused to the complainant.
If an insurer becomes insolvent, who would a small partnership apply to for compensation in light of a general insurance contract?
A. FOS
B. FSCS
C. FCA
D. Bank of England
B. Small partnerships can claim off the FSCS.
Per the complaints procedure, how often are firms required to file a summary report of complaints received?
A. Monthly
B. Quarterly
C. Semi-annually
D. Annually
C. A firm is required to file a report with the FCA every six months, even if it has not received a complaint during the period.
