U2: T25 - CONSUMER RIGHTS, COMPLAINTS AND COMPENSATION Flashcards
In situations where alternative dispute resolution is being used, which of the following options allows for appeal through the courts?
a) Arbitration.
b) Mediation.
c) Adjudication.
d) Conciliation.
c) Adjudication.
Note that option d) conciliation is not one of the options available under alternative dispute resolution.
In summary, in what circumstances is a contract or notice deemed to be unfair?
A contract or notice is deemed to be unfair if it causes a significant imbalance in the rights and obligations of the various parties to the contract to the detriment of the consumer.
Which of the following would not be classed as an eligible complainant according to the FCA’s definition?
a) A private individual.
b) A business with an annual turnover below £6.5m and fewer than 50 employees, or an annual balance sheet below £5m.
c) A charity with an annual income of less than £6.5m when the complaint is made.
d) Trustee of a trust that has a net asset value of less than £6.5m when the complaint is made.
d) The net asset value must be less than £5m, not £6.5m.
Which of the following is a step that must be carried out when a firm receives a complaint, if it cannot be resolved within three working days?
a) Call the complainant to discuss the matter.
b) Advise the customer that they can refer the matter to the FSCS.
c) Refer the complaint to an individual in an FCA governing function.
d) Ensure the complaint is investigated by a person of sufficient competence, who, where possible, is not someone directly involved in the matter under complaint.
d) A firm must ensure the complaint is investigated by a person of sufficient competence, who, where possible, is not someone directly involved in the matter under complaint.
Within what period of time does the FCA expect firms to resolve the majority of complaints?
Eight weeks.
Once a firm has completed its procedures for resolving a complaint, it must always issue the complainant with a final response letter.
True or false?
False.
For complaints that are resolved by close of business on the third working day following receipt, the firm must provide a summary resolution communication to the complainant, advising them of their right to refer the matter to the FOS should they remain dissatisfied with the firm’s response.
For how long must records of complaints involving MiFID business be retained by the firm?
a) One year.
b) Three years.
c) Five years.
d) Indefinitely.
c) Five years.
Within what time limits must a complaint be made to the Financial Ombudsman Service?
Complaints to the FOS must be made within six months of receiving a final response, six years of the event that gives rise to the complaint, or within three years of the time when the complainant should have become aware that they had cause for complaint, whichever is the later.
Which organisation is responsible for dealing with complaints relating to the sale of pension products?
a) The Financial Ombudsman Service.
b) The Pensions Ombudsman Service.
c) The Pensions Advisory Service.
d) The Financial Services Compensation Scheme.
A) The Financial Ombudsman Services.
The Pensions Ombudsman Service and The Pensions Advisory Service only deal with complaints relating to the running (ie administration) of personal and occupational pension schemes. The Financial Services Compensation Scheme deals with compensation for customers who have lost money through the insolvency of an authorised firm.
What is the maximum permissible compensation payable by the FSCS for a term assurance policy that provides £100,000 cover over a 20‐year term?
One hundred per cent of the value of the policy with no upper limit.
Sarah made a complaint to her bank and is not satisfied with the response. If she wants to refer the complaint to the Financial Ombudsman Service, she must do so within what period of the response?
Question 1 options:
a) 30 days.
b) 4 weeks.
c) 3 months.
d) 6 months.
d) 6 months.
In relation to the Financial Services Compensation Scheme (FSCS), which of the following is true?
Question 2 options:
a) Compensation cannot be awarded for stock market losses.
b) Small businesses are not eligible to make claims to the FSCS.
c) Oversight of the FSCS is solely the responsibility of the FCA.
d) Home finance claims are limited to £85,000 per mortgage.
a) Compensation cannot be awarded for stock market losses.
Which of the following would result in full settlement of a claim to the Financial Services Compensation Scheme?
Question 3 options:
a) Saleem, whose car insurer became insolvent before his accident claim was settled.
b) Will, whose home contents claim has been refused by his insurer.
c) Dolores, who lost £90,000 as a result of her investment adviser’s insolvency.
d) Greg, who is not happy with his bank’s final resolution letter in response to his claim for £4,000 compensation for a product mis-sale.
a) Saleem, whose car insurer became insolvent before his accident claim was settled.
Under the Consumer Rights Act Alternative Dispute Resolution options, adjudication decisions can be appealed through courts
Question 4 options:
a) True
b) False
a) True
Within what timescale must the FCA respond to a super-complaint?
Question 5 options:
a) 30 days.
b) 60 days.
c) 90 days.
d) 120 days.
c) 90 days.
